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Home Equity Up Since Beginning Of Time...Or At Least 2009

By
Real Estate Agent with Realty Executives Success

This is my initial re-foray into blogging on AR with my first post on the Chicagoland Real Estate Report. I am republishing a post I just put up on DISCOVER! Joliet Homes, my local blog about Joliet, IL real estate. I am excited to be joining the active ranks of bloggers on AR and look forward to your comments and opinions. Here goes:

I believe it was Mark Twain who said "Lies, damned lies, and statistics". Mr. Twain, if I have my history correct, was implying that numbers can be very persuasive and that statistics often are used to support weak arguments.

So it was this afternoon that I was looking at the new Housing Scorecard that the Obama Administration had published in June that is going to be taking a monthly look at the national housing outlook (insert snide comment about lack of life here).

As I was perusing the 11 page pdf, I found a chart that on first glance encouraged me and then, on further reflection, tickled me in a darkly humorous manner. Let me explain:

The chart, on Page 7 of the pdf, is titled "Home Equity Up More than $1 Trillion Since First Quarter 2009". This my friends is a good thing. As you can see in an excerpt of the chart shown below, in Q1 of 2009 collective home equity was around $5 Trillion and now one year later it is safely above $6 Trillion.

Home Equity Up $1 Trillion

Hooray for equity! Unfortunately, though, the chart is a little larger than the one that I excerpted above. The complete chart is shown below:

Equity Down 50 Percent

As you can see, home equity is off quite a bit since Q1 of 2006, where according to the chart, it was around $13 Trillion. That chart, if the illustrator had been given some type of truth serum, might have been better titled "Home Equity Down Over 50% Since First Quarter 2006".

Lies, damned lies, and statistics.

NOTE: I wrote this not to criticize the current administration nor to pine for the days of inflated housing values, but to illustrate that housing news is too often delivered with a rose tint. We all want the outlook to improve, but tilting the outlook won't improve its trajectory.

Ken's Home Team LLC. | 360.609.0226 | Portland, OR & Vancouver, WA Real Estate Team
Ken's Home Team LLC. - Vancouver, WA
- SOLD IS OUR FAVORITE 4 LETTER WORD -

wow GREAT Job, nice info to see.   Thank you, for taking the time to do this.

Jul 06, 2010 09:43 AM
Anonymous
Tim Soper

Thanks for the nice words, Ken. Hopefully you'll check back from time to time and see if I can keep up the content.

Jul 07, 2010 10:43 AM
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