[firemed]

For people to move to Florida most have to sell homes up north to buy here. But when The chief economist for the NAR is walking away thats bad news. This will be more jobs lost.

We’re in a real estate recession,’ said David Lereah, chief economist for the National Association of Realtors, who surprised many this week when he announced he would leave the Chicago-based trade group on May 19. ‘I’m projecting the first [nationwide] price drop since the Great Depression,’ he said. ‘We’re going to have negative home prices in 2007.’”

“‘He promotes housing,’ said Washington economist Dean Baker. ‘Certainly, people who were making decisions to move, they either heard David directly or from someone who heard from David that home prices will never fall, don’t worry, the market will stay strong. So they paid too much for a house.’”

“Lereah, in an interview Wednesday, shrugged off the criticism. ‘I feel confident I did a very good job forecasting and reflected what was happening in the marketplace,’ he said.”

“‘If anybody actually took the time to read my book, rather than just comment on the title, I was insistent in it that…a frenetic boom was unsustainable. I predicted a downturn [would occur] shortly after I wrote it, in 2005,’ he said.”

“Lereah said the market overheated primarily because of lax lending practices and record numbers of speculators who bought houses at inflated prices to flip for profit, though others share the blame. ‘It’s easy to say with 20-20 hindsight,’ he said. ‘We’re all partly guilty. But the lenders and the speculators, they had the most in it. Making zero down payments with no documentation, that’s just irresponsible.’”

“‘But the Realtor, the lender, the title attorney, they all got wrapped up in the frenetic pace of the boom,’ Lereah said.” “He has one more public appearance, at a Realtors’ conference in Washington. He warns that his speech will not be cheery.”

“‘I am going to say, look, guys, we all have to face the music,’ Lereah said. ‘We strayed from [economic] fundamentals, and we’re paying for it. It’s not an all-out bust, not a crash in real estate, but it is a recession. This is going to cleanse the markets and in the long term this is what we have needed.’”

“In characteristic cheerleader style he demurred when asked whether he ever felt pressure from within NAR to skew forecasts in a positive direction. ‘You’ll have to talk to me about that in two or three weeks,’ Lereah said. ‘I work for NAR now.’”