Top Tales Spun By Realtors Revealed

Considering that real estate agents and brokers make make money whenever a client sells or buys a home or piece of property, it stands to reason that it is in the industry's best interests to motivate the American public to buy and sell as much as possible.

Enter the National Association of Realtors, which is a lobbying organization whose stated purpose is to "help its members become more profitable and successful."

I suspect that the average American doesn't realize the true motivations behind NAR's numerous marketing campaigns and statements to the press. Indeed, the lobbying group frames their crafty work with references to "the American dream" and "financial security" so that people continue to engage in real estate transactions. As the housing market started to cool and slow down, NAR stepped up its public relations efforts to thwart the public's perception that home sales and prices were declining.

A new series of print and online articles by the Wall Street Journal shines the spotlight on the half-truths and falsehoods spread by former NAR Chief Economist David Lereah. Here's some of the Top Tales that Mr. Lereah spun while to help NAR push its agenda of helping Realtors become "more profitable and successful."

January 2006
Lereah’s forecast: “The market is in the process of normalization.”
Actual sales: Fourth-quarter sales fell at an annual rate of 12.6% to 6.94 million annualized.
Lereah’s post-mortem: “The level of home sales activity is now at a sustainable level, and is likely to pick up a bit in the months ahead.”

April 2006
Lereah’s forecast: “Home sales will move up and down somewhat over the remainder of the year but stay at a high plateau.”
Actual sales: First-quarter sales fell at an annual rate of 8.6% to 6.79 million.
Lereah’s post-mortem: “This is additional evidence that we’re experiencing a soft landing.”

July 2006
Lereah’s forecast: “The market should even out just below present levels.”
Actual sales: Second-quarter sales fell at an annual rate of 6% to 6.69 million.
Lereah’s post-mortem: “The market is stabilizing.”

October 2006
Lereah’s forecast: “We expect sales activity to pick up early next year.”
Actual sales: Third-quarter sales fell at an annual rate of 22.2% to 6.28 million.
Lereah’s post-mortem: “This is likely the trough in sales.”

January 2007
Lereah’s forecast: “The good news is that the steady improvement in sales will support price appreciation moving forward.”
Actual sales: Fourth-quarter sales fell at an annual rate of 2.3% to 6.24 million.
Lereah’s post-mortem: “It appears we have established a bottom.”

NAR's new Chief Economist has continued the practice of issuing overly rosy statements, and the organization has launched a new print and television campaign. So the next time you see one of these ads or hear a Realtor speak, remember that their mission is to be "profitable and successful."

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