The Dallas Morning News continues to allow real estate editor Steve Brown some serious latitude with the truth when it comes to DFW home sales. In the latest article on May home sales Mr. Brown would apparently have you believe that “11,302 preowned single-family homes” traded hands in May. Unfortunately that didn’t happen! You would think that Dallas’ largest newspaper would have the resources to fact-check the rubbish Mr. Brown is printing in the digital edition of the paper, but apparently that is asking too much.
The Dallas Morning News real estate desk is quoting numbers from an NTREIS press release that are statistically estimated. Those numbers you see in the DMN sales reports should all contain an important disclaimer, the same one that’s in the press release…
“Note: Current month sales are preliminary”
Final sales figures can change from the middle of the month to the end of the month, but usually not more than a few percentage points. Like all MLS’s, NTREIS receives some closing data belatedly. Real estate agents are sometimes late closing out their files. This is why the Real Estate Center at Texas A&M and NTREIS issue reports with a STATISTICAL ESTIMATE of what the final numbers will look like. Preliminary numbers are just that, preliminary.
Aside from the failure to disclose the estimation of sales figures, here’s where Mr. Brown is spinning a whopper of a story on May home sales that is only remotely attached to the truth. These simple facts from the actual NTREIS MLS sales data paint a slightly different story than the one Mr. Brown offers at the Dallas Morning News. These figures I am quoting are from NTREIS closed sales data as of tonights print, June 12 2018:
- MLS data currently show that 10,291 single-family homes were sold during the month of May, down 0.8% from the 10,369 single-family home sales in May of 2017.
- Current MLS data show that 11,113 homes were sold last month for ALL PROPERTY TYPES. This is down 1.3% from May of 2017 when 11,261 properties were sold.
- MLS data show that 9641 RESALE properties changed hands last month, a 1.9 percent decline from the 9824 properties that were sold in May 2017.
- MLS data shows 8934 sales for SINGLE-FAMILY RESALE homes, a 1.1 percent decline from the 9029 sales in the same month a year ago.
- MLS data show 2.9 months of supply for all property types, 2.8 months of supply for single-family homes.
So there you have it. Those are the actual preliminary sales figures from the NTREIS system as compared to the same month a year ago. Did you notice anything interesting? They all show sales declines, at least based on the preliminary sales figures.
The truth is that we’ll probably see those sales totals edge up a few percentage points by the end of the month, but a 9 percent sales gain is a comical work of fiction. Even the published press releases from May 2018 and May of last year do not corroborate a 9 percent increase. Actually they show a 3.3% year-over-year increase, keeping in mind both figures were preliminary estimates at the time of print.
I have some ideas on why the Dallas Morning News would allow this kind of misinformation to be printed, but that’s another article for another day. For now, just realize that Dallas’ largest newspaper has a real estate “editor” who apparently doesn’t even understand that “preowned single-family” sales aren’t the same thing as total home sales. Yikes!
Another falsehood spouted by Mr. Brown is the assertion that May 2018 saw the “the largest number of home sales ever in a single month in North Texas”. Sorry, but that’s not true either. NTREIS data shows that June 2017 was the best month on record for DFW home sales with 11,915 sales (all property types), not last month as Mr. Brown is suggesting.
If you are in the market to buy or sell a home, be careful where you get your “news” from. That “excessive demand” from investors is probably accurate, but millennials are having a hard time keeping up. It seems the Dallas Morning News is willing to ignore basic facts to offer up a rose-colored-glasses version of the local real estate market. That detachment from the truth could be harmful to your wallet.
UPDATE June 13 2018: I was able to contact both MetroTex and the Real Estate Center at Texas A&M to see why there is a disconnect between the published market report sales totals and what’s showing up in the current MLS data. I received email correspondence from Gerald Klassen who is apparently in charge of preparing the monthly sales reports at the REC.
Mr. Klassen explained that the single-family sales total for May 2017 was originally overestimated, by a substantial margin it turns out. I suspected this might be the case, so I cross-referenced all of the 2017 market reports and it turns out that sales were overestimated for every single month during 2017. The overestimation ranged from 300 to more than 600 sales in a given month, but the average initial estimate was about 5% higher than the real final sales volume. The casual observer wouldn’t notice this unless you scrolled down to page 3 of the most recent report to find the updated (final) monthly sales totals for the previous year’s data.