There’s an episode of Dr. House where his team is arguing over some test result and whether or not a change of one percentage point is statically valid. In order to underscore his point that this 1% was very significant, the loquacious Dr. House said this classic line:
“If her DNA was off by just one percentage point she’d be a dolphin.”
What I love about the character of Dr. House is his uncanny ability to see signs of life or hope in otherwise dark, hopeless circumstances. And his belief that small changes in a patient’s test results can indicate big changes in the future. Of course in that episode, the one percent change portended the difference between life and death for the patient.
Dr. House saw it. The others didn’t.
Two recent reports about housing are worth noting and celebrating this week, even if the media doesn’t see them, or is ignoring them.
The NAR just reported that:
- Existing home sales rose 5.1 percent in February, the largest increase in nearly six years; and
- Sales of new homes, meanwhile, rose 4.7 percent that month nationwide as well.
As confirmation of this amazing new construction sales turn, Lennart CEO Stuart Miller also reported this week that sales of new homes for this nationwide builder in the month of March were up significantly.
Think about it…Last month heavy with news about foreclosure sales, high inventories, and a supposedly dead construction market, it turns out that new homes were selling almost as well as existing home sales! And that both categories were up by around 5%.
Disappointingly, many news outlets chose to dilute this good news, with the usual caveats and discounting that pervades reporting today.
HUD secretary Shaun Donovan for example, famous for his pro-government philosophy that “the private sector, left to its own devices, is never the best possible solution”, speaking for HUD said today that:
“…the number of troubled loans backed by the federal mortgage insurance program is on the rise as economic troubles continue to mount.”
OK, Mr. Secretary of Gloom, we get it. It’s bad out there. Housing is in a crisis. We copy. But what about this jump in new and existing home sales? Can’t you at least mention that, and inject a little hope into the mix? I mean 5% is nothing to sneeze at, right?
Yet most of the media chose to ignore the signs of life that this 5% represented.One reporter even indicated that this kind of statistical improvement amounted to “next to nothing” in comparison to prior years.
Next to nothing? Come on!
Time for a Dr. House line:
“I was never that great at math, but ‘next to nothing’ is higher than nothing, right?” Dr. Gregory House Season 3.
When it comes to looking at housing, and our industry, I prefer a Dr. House approach, rather than a Dr. Gloom and Doom approach, don’t you? Especially when the statistics support it.
The media sees a jump in home sales of 5% and they consider it an anomaly, a false-positive, a blip on the MRI scan that should be ignored. I see it as a giant sign of life for our industry.
There are more signs that the worst is over. Next posting I’ll report on some more amazing statistics that forecast better months ahead. In the meantime, tell me what you think, by posting a comment here. I don’t care if you agree with me or not, just let me know what you think. As Dr. House said:
“You could think I’m wrong, but that’s no reason to stop thinking.” Dr. Gregory House. Season 4
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