Generally speaking, the consensus seems is that the residential real estate market in most parts of the country is on the upswing in the aggregate. As a licensed Realtor, I will run with that consensus as much as I can because so much of our economic health is psychological and relies on consumer perception. Anecdotal evidence indicates that there is an impressive correlation between the tone of the national headlines about the economy and the psyche of the average consumer. If the news anchors say the sky is falling everyone will soon be running for shelter, even if there is no empirical evidence to support the claim. Similarly, if national headlines are droning on about the lousy economy, high unemployment, and soon-to-be-rising interest rates, home-buying will grind to a virtual stand-still. What both of these occurrences have in common is that they frequently rely on inconclusive, or superficial, data that do not adequately represent the economic “status-quo”. For example, below is a graphical representation of actual data from Core Logic, an aggregator of real estate data (among other things).
The old saying goes: “The only difference between a recession and a depression is that in a recession your neighbor is out of work, in a depression YOU are out of work” So what does this mean? Selfishly speaking, I don’t know and as long as houses are selling in RI and MA (which they are) I am not sure if I should be concerned. However, when I read economic data that do not support the economic outlook; in the back of my mind I can hear the voice of one of my college economics professors emphatically stating that the real numbers do not lie…but those numbers can be manipulated by others for political gain. Case in point: http://tiny.cc/ifnutx an article in the NYT trumpeting the great employment outlook, and this sobering report by the CEO of Gallup http://tiny.cc/oknutx. What do you think???