National housing forecasts miss the lot level reality

Nobody ever lost money on a national average. They lost it on a specific piece of dirt. The national housing market doesn’t buy lots, build houses, or pay development loans. Local customers do. So why does our industry keep treating national averages like local investment strategies? Housing is down nationwide. So what? What’s happening in Texas? So what? What about Dallas–Fort Worth? So what? What about Fort Worth? So what? What’s happening in Parker County? So what? What’s happening in Weatherford? Now we’re talking. For an industry that invests billions of dollars in assets that cannot be moved, we spend an extraordinary amount of time discussing information that tells us surprisingly little about the land we’re buying. National housing starts. Mortgage rates. Builder confidence. Median home prices. Months of supply. Migration patterns. We slice the data by state, metropolitan area, and county. We hire economists, subscribe to forecasting services, attend conferences, and listen to experts explain where housing is headed. Then we spread those broad conclusions across entire markets like peanut butter, and wonder why the investment results don’t always match the forecasts. Land i...