Estimation

Glenn E. Crellin

Director, Washington Center for Real Estate Research

Washington State University

Statistics are estimated. No matter how sophisticated we like to pretend, there are assumptions involved in virtually all statistical procedures. For example, the Washington Center for Real Estate Research estimates the number of housing units in Washington. Since we created the statistic in 1994, the approach was to use the number of housing units identified during the 1990 Census of Housing and add to that the number of new units authorized by building permits. No estimates were made for demolitions or conversion from housing to other uses. No adjustments were made for housing units where a building permit was issued and no unit was constructed (or it was never completed). No adjustment was made for conversions of single-family homes into structures, which will be rented to multiple households. No adjustments were made for the construction of housing units in areas where no building permits are required, (although in Washington there are comparatively few of these).

Recently the Census Bureau released estimates of housing inventory by county, so it is time to compare the simple Washington Center for Real Estate Research estimates to the 2000 Census and subsequent estimates, to see how accurate the estimates may have been. First, a caveat – the Census estimates are for April 1, 2000 and the Washington Center for Real Estate Research estimates for all years are year-end values.

The Washington Center for Real Estate Research had originally estimated there were 2,476,283 housing units in Washington as of year-end 2000. That estimate was low. There were 2,451,075 units identified in the 2000 Census, and additional construction during the remainder of 2000 means that a better estimate would have been 2,480,462. The simplistic approach was only off by 4,179 units over a 10-year time period (0.17%). That is surprisingly accurate given the number of potential error sources.

By year-end 2002, the inventory of housing units in the state had climbed to 2,559,233 or 4.4 percent more than existed at the time of the last Census. The state’s population has grown by only a little over 2.5% over the same time period, implying that housing choices are becoming a bit more plentiful.

Statistics on Washington’s housing market and other useful information are available on WCRER’s Web site: www.cbe.wsu.edu/~wcrer. For other information on real estate markets around the State of Washington, or general information about the real estate industry in the state (excluding legal questions), readers can reach the WCRER at 1-800-835-9683.

March 2003