A note on Oahu sales data April home sales rise as prices fall
By Andrew Gomes
Since March, a contractor has compiled sales statistics for the Honolulu Board of Realtors, and is counting various data differently than the local association of real estate agents had historically.
The contractor, 10k Research and Marketing, and the Honolulu Board of Realtors say the new method of reporting data such as completed sales, inventory and speed of sales presents a more accurate and truer picture of O'ahu's housing market.
While 10k revises last year's data for each monthly report so it has an apples-to-apples comparison, the firm hasn't revised all Honolulu Board of Realtors data that goes back to 1985, which makes many historical comparisons meaningless.
The Honolulu Board of Realtors made the decision to outsource data collection after its longtime economist Harvey Shapiro died in September. 10k is an affiliate of the Minneapolis Area Association of Realtors that produces statistical reports for different real estate agent trade associations.
Here's a breakdown of the changes in methodology:
• NUMBER OF SALES
Old way: To speed delivery of monthly reports, some sales that occurred in a given month but were reported late by brokers were included as sales in the following month's report.
New way: All sales completed in a given month are included in the same month's report, which delays release of the report but gives a more accurate count of sales during a month.
Effect: The difference appears small. The number of April 2009 single-family home sales differs by two among the two methods. However, the effect on median prices can be more pronounced. 10k revised the April 2009 single-family home median price to $600,000 from $585,000. The March 2009 median was revised to $575,000 from $600,000.
Old way: Pending sales were excluded from the number of homes listed for sale.
New way: Pending sales are included because pending sales can fall through.
Effect: The change can be significant. 10k revised the April 2009 single-family home inventory to 2,088 from 1,822.
• MONTHS OF REMAINING INVENTORY
Old way: Present month's inventory was divided by the number of completed sales in the same month.
New way: Present month's inventory is divided by the average monthly number of pending sales over the prior 12 months.
Effect: The change can be significant. 10k revised the April 2009 figure to 10.5 months from 9.7 months.
• DAYS ON THE MARKET
Old way: Calculated the median number of days between a property being listed for sale and the signing of a purchase contract.
New way: Calculates the average number of days between a property being listed for sale and the closing of a sale.
Effect: A dramatic difference. The closing period, or the time between when a purchase contract is signed and when a deed is recorded, can be one to three months, or longer. There is also a difference between median and average. 10k revised the April 2009 figure for single-family homes from 51 days to 82 days. The new calculation gives less of a sense as to how fast or slow buyers are making acceptable offers.