Both new home sales and pending home sales for October missed Wall Street estimates and were overall disappointing. Pending home sales actually dropped. I’ll have more on this either tonight or tomorrow.
But I had to publicize the fact that NAR Chief Economist, Larry Yun, has lied about the data. With regard to an attempt to put positive “spin” on a bad pending home sales report, Yun said this: “…buyers entering the market this autumn are being lured by the increase in homes for sale and less competition from investors paying cash.”
Yun is trying to explain that less buyers are paying cash and that is stimulating mortgage-financed sales. Nothwithstanding the FACT that mortgage purchase applications are in a tailspin, here’s the cash vs. mortgage data for October’s existing home sales – direct from Yun’s report released last week: “All-cash sales were 27 percent of transactions in October, up from 24 percent in September…Individual investors, who account for many cash sales, purchased 15 percent of homes in October, up from 14 percent last month.” Yun’s spin on the negative pending home sales report is therefore a lie.
As I detailed in this article – LINK – the all-cash flipper purchases spiked up in October. The 1st time buyer who requires a mortgage stayed constant, which means the move-up buyer segment and the distressed buy-to-rent-to-sell segment dropped.
Larry, Sir Walter Scott has a comment for you: “Oh what a tangled web weave, when first we practice to deceive.”