“It has been quiet on the news front but very busy in REALTORS® offices as they list client’s properties for sale, book showings for buyers and attend open houses. This has not resulted in immediate sales, however, and, in anticipation that this slowdown will continue through the year, we have reduced our 2010 sales forecast by 2,000 units from 21,000 to just 19,000.”
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“External influences pulled sales activity into the first four months of the year which reduced the demand in May and June. Overall there were 680 less residential sales in the first half of the year as compared to 2009,” said Westergard.
They have reduced their forecast to 19,000 based on how close we are to last year's sales. However last year started off in the middle of the financial crisis and sales continually increased from very low levels. 2010 has been the opposite of this. To show how unlikely this is see the level of sales that would be required for the rest of the year in the trend below (at a constant seasonally adjusted rate). Sales have to make an immediate and abrupt jump this month to a much higher rate and maintain that level going forward.
Looking at the trend I guess the year end total will be closer to 16,500 assuming a minor recovery in sales (shown below).
4 comments:
Great Post! The graph really does a great job of showing the absurdity in their estimate.
I remember reading calculatedrisk in 2006-2007. He did the exact same type of analysis in the US, where housing experts were consistently far too bullish in their estimates.
Good post Bear.
Kevin......
Sales are falling off the map here in Calgary as well.....
For June and July they are down around 55% +/- from the 2007 bubble highs, and down some 45% +/- from last year at this same time.
If this happens in August as well, anad I see absolutely no reason why not (even though the summer is supposed to be their busy season, school being out and all that, so families want to move, etc) it will be one straight quarter of 45% off sales figures and a huge collapse in RE market and the confidence therein.
New data out from City of Calgary census. Population growth is at a 27 year low:
http://www.calgary.ca/docgallery/bu/cityclerks/2010_census_result_book.pdf
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