See-Saw News Stories!

News is what sells newspapers, captures your attention as you pass the TV or while listening to the radio in your car. To capture your attention news needs to be short and sound exciting--whether it is good or bad.

We have been conditioned to react to extremes. Not so long ago, we were hearing only gloom and doom from the media regarding the housing market. Now, everyone is suddenly excited by all of the recent headlines that say "homes sales are increasing."

What home sellers often interpret such headlines as meaning is--the market is doing much better so I can ask the same price as my neighbor did last year or the year before. Okay--that might seem logical, but what if the reason more houses are selling is because they have been foreclosed on and are selling for much lower than market value, driving prices down further?...or perhaps prices are increasing 2% after something like a 22% drop? Well, that turns the Seller's assumption upside down!

Now look at an actual recent headline that said "New Construction is up 11%." Sounds WONDERFUL. Let's celebrate! We're fine! Wahoo!!! But, if you take the time to look deeper and see that looking back at the average increase historically shown in that particular month, this was the worst increase since 1982. Suddenly, you see that all of the excitement and celebrating is unfounded.

Unfortunately, people who rely only on what they read, hear or see in headlines and soundbites can be misled by phrasing, as well. Take this statement that is written in the manner of many headlines--"The chicken is ready to eat." Depending on how you read this, it can be determined that your chicken dinner is served--or--looking at it another way, your pet chicken is hungry and waiting to be fed.

Another thing the press does can give us whiplash. You get one headline--like when the Wall Street Journal--a very respected publication--prints a story in July that says Home Sales are Up All Around and that is followed less than a month later with one saying that the housing market's "Foundation Appears Firm but Prices Keep Falling."

Relying on just headlines and soundbites to tell the true story doesn't work. Aug. 25, 2009 MSNBC posted an AP story with this headline--"Home prices post first quarterly rise in 3 years." Continue farther down in this same article and you get this summation--"Prices, however, have a long way to go to recover completely. Every metro showed annual declines, with fifteen reporting double-digit drops." Again, not the rosy picture you expected from the headline.

Delving deeper into the facts is what we need to do. As your Real Estate professional, it is my responsibility to keep up with the facts and to be ready to interpret the headlines based upon the reality of the facts that are behind the headlines. I will be happy to discuss the current market conditions with you and to explain how things are going. Just call or email me anytime!