OC Register - "Census' new-home sales stats seen as weak" (1-14-07)

"The Census Bureau is grossly overstating new home sales. They mean no harm. You just have to understand the data. Over and over again, we find that what you read is not necessarily the whole truth. The most recent Census Bureau data indicates the annual rate of new home sales is down 23% from its peak in July 2005. However, we know this figure understates the correction. The reason is that the Census Bureau publishes gross sales figures rather than net sales. In an environment of stable cancellations, this is not an issue. However, this is hardly an environment of stability. A NAHB survey of a sample of large builders found that cancellations nationally averaged roughly 18% of gross sales during the first half of 2005, yet averaged 38% of gross sales in November of this year."