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Competition in YOY Forecast

by Chicago Agent

New projections for housing sales have some analysts divided on their meaning.

Early reports on Augusts’ Year Over Year (YOY) forecast have lead to competing forecasts between financial and economic analysts.

The National Association of Realtors (NAR) estimated that home sales this July ran at a SAAR of 4.67 million, a rise above the 4.24 million viewed in August of last year.

This past August, however, had one more business day than the last, which has lead NAR analysts to expect a seasonal adjustment of about 1.5 – 2.0 percent. The resulting adjustment has rendered the NAR to give a “flat” reading for existing home sales this August. While lower than earlier expected, NAR analysts have inferred from this a YOY gain in NSA sales between 11.8 and 12.3 percent.

Economist Tom Lawler doesn’t foresee a “flat” reading in his forecast. “The reports that have come in suggest to me that existing home sales in August rebounded from July on a seasonally adjusted basis.” Lawler however points out that not enough real estate associations have released their stats to give a concrete national reading.

Analysts at Calculated Risk, an economics and financial blog, have a more positive forecast in their sights. They expect the national YOY gain to be well above the NAR forecast at 16.8 percent with a seasonally adjusted SAAR of 4.87 million, a roughly 4.3 percent gain from July. Calculated Risk interprets the increase to arise from a combination of increased cancellations and delays from contracts to closing.

Only time will tell whose forecast proves to be correct as more Realtor associations and boards release their statistics.

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