Garth “I didn’t say crash” Turner has been discredited numerous times because of his hallucinatory predictions, followed up by self-inflicted amnesia. He’s admitted that if he can’t find a source for his theories, he simply makes up his own data. He’s now hitched his wagon to Ross Kay, a fortune-teller with startling revelations.
I’d never heard of Ross Kay until Garth publicized this sensational prediction, but being endorsed by Garth Turner is a warning sign of sketchy and unreliable data. I wouldn’t have given Kay a second thought, except he’s also accusing CREB of double-reporting sales. We analysed this in my previous post and have shown there is no evidence for Ross Kay’s claims. Waiting on Ross Kay’s open and full disclosure. I’ve asked Kay numerous tmes to produce the evidence, but he has gone silent.
Let’s now look at Ross Kay’s prediction that the market died on May 19, 2013 and see how it relates to Calgary’s data four months later. (Ross was sure it would manifest itself within 60 – 90 days, so we’ve given him a couple extra months for good measure).
The following blog post was written by Garth Turner on May 29, 2013 on the Greaterfool.ca http://www.greaterfool.ca/2013/05/29/a-downward-spiral/ :
The day it died (by Garth Turner, GreaterFool.ca)
In 2008, GTA realtor Ross Kay invented an ‘engagement index’ to statistically chart house horniness. For five years he’s been diligently amassing data, filtering and weighting it, and watching in fascination as 60 to 90 days later changes in his index appeared as official published real estate data.
His track record (he says): 100%.
Hours ago he released what he considers ‘drastic’ results, in a warning to his clients. “Over the course of the last 9 weeks, our index has revealed a downward spiraling real estate marketplace, with results that will not reveal themselves in MLS sales data until finally reported by Organized Real Estate Associations,” he wrote on his site. (This has been removed from his site – Bob)
In a note to me, he adds:
“On May 19th, 2013 we recorded the lowest value of Canadian consumer engagement in real estate since 2010. What is scary here is that on April 8th 2012, we reached an all time high engagement value. The May 19th numbers for 2013 represent about a 72% decline over that peak number. This massive decline raises grave concerns not being reported in newspapers across the country.
“So we project 60 to 90 days from May 19th that MLS sales will be reported that will reveal the market died on May 19th. Our numbers have not been wrong since 2008. So as it turns out the peak of the real estate market in Canada was April 8th 2012, as posted here on Greater Fool. Peak pricing was established and as recorded MLS sales prices now show, anyone who bought in competition around that date paid too much.”
Is this credible? Obviously we’ll find out in a couple of months…
How did Ross Kay’s prediction play out in Calgary? Was Ross Kay 100% correct? 50% correct? or dead wrong?
September 2013 price is up 9.2% compared to last year.
September sales are up 20% compared to last year.
Inventory, which you would expect to increase in a dead market, is down 20%.
Would there be bidding wars during a dead market? 18% of homes were sold for list price or higher in Sep.
Not exactly the sign of a dead market.