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While the Phoenix Mars Mission is doing quite well much closer to home we have a problem. I wrote about an issue with a mobile home which sold in April 2008 with a sq. ft. of 1. This made the Tucson Mobile Home Average Price per Sq. Ft. $6,728.
It is more than a month later and this has not been changed. What’s the big deal. This one single entry is throwing all the figures for the month of April way out of whack, (whack being a data entry technical term). It will also effect the Second Quarter figures if it isn’t corrected. The last time this entry was updated was April 22, 2008. This is now more than a month old and because it was an April Closed Transaction it appears to be considered “Old News”. IT ISN’T.
This sale needs to be corrected and a fine needs to be issued for everyday it continues to skew the data. Tucson MLS, Let’s Clean Up the Data.
As if we weren’t getting enough “Bad News” from the S&P Scare Report. We have to endure the factor of Garbage In Garbage Out here at home.
More on the S&P Case Shiller Report this week. A good review would be the January post on the deficiencies of this report for judging the housing market. It wasn’t created for what it is being used. Now the Darling of the media it is like using a knife for a screwdriver and declaring how hard it is to make it work.
Personally, I think it should have been called the Tucson Mars Mission since it is the U of A that is taking the lead on this project, as usual Phoenix gets the credit : )
Noise in the data does have a big impact. It is a common problem on Wall Street where trades are mis-reproted or prices are dropped from the time series. Averages can smooth out the noise or filters can be used. Stopping intentional mis-reporting is critical.
Does the MLS organization have a position on obvious mistakes? Can they force the transaction out of the data if a correction cannot be found?
On the S&P/Case-Shiller survey or indexes. It does help to read the methodology information. You can see how they intentionally leave out large sections of the market in each city (new build, condo, town homes, etc). It was created to provide a benchmark for a tradable index on the exchanges. The press like it because it is easy to talk about (specific number that is easy to discuss almost how ever you like).
I am a real estate investor and I work with other investors to advise them of what will work in the market. I continue to repeat to them that deals are done one property at a time. It does not matter what the index says. There is a buyer and a seller and there is a deal to strike that has to work for the two parties no matter what some index says about a blended average of properties they are not buying.
I think it’s absurd that a sale like that can effect the market in such a way. Something should be in place to keep such things from having that type of effect.
Frank,
I agree with you, there has to be a policy to keep the data as clean and accurate as possible. The Tucson MLS needs this, if they have it they need to enforce it.