Why 3 years?

‘The real estate executive says July sales statistics from a historical standard were “tepid” and adds the numbers gets “the big headline” because the comparison is to a period when housing sales were slumping badly.’


If you’ve followed my blog, you’ll be aware that I’ve been comparing the present year to the average of the past 3 years when I compile the market updates. The story in the Financial Post illustrates the reason why. A single year can be an outlier, an anomaly. It can severely distort the overall picture when comparing to a single year.

In the same article, David Madani of Capital Economics gets thrown under the bus for his history of incorrect predictions. He’s been predicting a 25% correction consistently for 30 months. If the Canadian market declines 25% from today’s prices, it will be pretty much back where it was when he started his forecasts. Now that Harold Camping has met his maker, perhaps Madani can take his place at the table.

It would appear that CREA is the voice of calm and reasonableness: “Canadian home sales have staged a bit of a recovery in recent months after having declined in the wake of tightened mortgage rules and lending guidelines last year,” said Gregory Klump, chief economist with CREA, who expects August results will also look strong as they are compared to a weak 2012.”

Accolades to First Foundation

When Madani first made his prediction in Feb 2011, it was rebutted by a mortgage broker who wrote, “people are not over-leveraged, that our incomes are sufficient to pay our obligations, and that the fundamentals are solid for a good, old fashioned, boring real estate market where reality overcomes emotion and conjecture.” It wasn’t sensationalist enough to attract any headlines, but it was accurate. Why David Madani is wrong

I’m not sure how a guy like Madani is able to keep his job in the light of such incorrect forecasts. On Capital Economics home page it states, “we have gained an enviable reputation for original and insightful research.” Good thing they don’t claim that it’s accurate.


4 responses to “Why 3 years?

  1. More great RE results come out driving turner insane(r).
    Too funny.
    So what does the dishonourable turner do?

    He writes about Ireland.
    Ahhh, yeah OK, good work gartho.
    Maybe he should compare Calcutta to Calgary or Toronto, that would get his psycho cult members chanting in the streets.

    Lets keep track of where exactly turner’s has gone wrong for 6 YEARS now;

    – Housing crash imminent (dead wrong)
    – Interest rates to go to 6% or higher by 2012 (WRONG – 3.7% can still be had or lower)
    – US economy to rebound (far from it and the GDP continues to nosedive)
    – QE to end in 2013 ( not a snowballs chance )
    – Gold to crash to $800 or so ( Wrong – already breaking out this month)
    – all Real Estate Boards lie (I asked him if they lie then why not sue them – that post never made the love-in blog = no response)

    Considering these 6 topics are all he ever talks about, I think that equates to a 0% success rate. Kind of like his Finance days.

  2. Both Madani and Barf Turder are becoming more desperate with each passing month. At least the other member of the disgraced trio, ‘Ben Rabid-Dog’ has sort-of capitulated and has finally ceased making goof-ball predictions. News flash bozos: Time’s Up! You Lose!
    It’s funny observing how certain individuals become absolutely married to their prognostications, oblivious to the realities surrounding their puffed up egos, stubbornly insisting that “time will tell.”

  3. Is this guy wrong Bob or is he another doomer like GT? He is an ex realtor so he knows the ins and outs. No? He implies that the CREA numbers are not fully truthful to say the least.

    “The number of home sales sold under Full Agency Contracts and processed through the co-operative listings systems in Canada was .2 % lower on a year-over-year basis for the month of July. Sales edged down year over year for the 12th consecutive time in the past 12 months. July’s decline was the smallest recorded monthly year over year comparison in the past year, due to pressures from pre-approved mortgage deadlines required to secure lower interest rates.”

    “Resale Home Sales have actually declined 12.86% Nationwide for the first six months of 2013 versus the first six months of 2012, when considering the same data set year over year.”


    I don’t have access to the raw numbers nation-wide, so I can’t say one way or the other. My readers are mostly concerned with Calgary, where I have full access to the data, and the numbers I post are taken directly from the data base, which I have complete confidence in. You should ask ex-realtor Ross Kay if he can find any discrepancies with the Calgary numbers. -Bob

  4. Further to YYC’s question, perhaps Teranet’s data is a more trustworthy corroboration to CREA’s numbers. Teranet is independent and does not use any real estate board’s data in their research. They report that nation-wide prices reached an all-time high in July.

    At one time I compared Teranet’s numbers to CREB’s median price. The two followed each other so closely, I concluded that CREB’s numbers were an accurate portrayal of the market, and until recently, Teranet was always a month late.

    Six to seven years ago, Mike and I started giving out free information that was more complete and timely than you could get anywhere else. I doubt if anyone remembers the days where CREB’s month-end report would take up to 3 days to reach our eyeballs, or when the daily stats consisted of a ticker giving the average price. That was all you got.

    It took a few years, but the “rising tide lifts all ships” scenario was proven true once again, and now CREB has a reputation for promptness, innovation, and accuracy. Nobody in Canada has better or more thorough information about their housing market than Calgarians.

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