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Homes For Sale Twin Cities

Media Fueling Home Sale Slump

By: Pete & Theresa Shrader
Tuesday, July 03, 2007 8:15 PM

"The days of a slower market are upon us." You hear and read this message nearly everyday.  Radio snippets, nightly news segments, and newspaper articles reporting that homes aren’t selling, foreclosures are up, and prices are slipping. The “experts” say things are bad, getting worse, and not likely to improve anytime soon.

 

Many buyers who are hearing these reports are reacting with a wait-and-see attitude. Some buyers might think “Why would I want to buy now if I can get a better price later?” others say “Why would I want to buy a house if it is going to go down in value after I buy it?”

 

What if the media found just one “expert” that sees good things for the housing market on the horizon? What would happen if the media came out with a report that said “The housing market will turn around by fall 2007! Buyers should buy now to get the best value/lowest price!”? What do you think that would do to the market? Would buyers jump back into the market in an effort to get the best price/value? I bet some would.

 

The point is the media is not helping by churning out negative doom-and-gloom information to the very people who could turn the market around - the average home buyer.

 

Once the positive messages hit the airwaves and newsstands of America the market will start to recover. It'll take just one or two mainstream reports saying things are starting to look up and they will.

 

Is there a reporter out there who will find that 'expert' and begin to turn the tide?

 

Pete Shrader

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Comments

Mark Cohen, Broker
Member Since '03

Mark Cohen, Broker said:

Please answer these questions:  Did the media also fuel the housing boom?  Why do so many people want to sell their homes at the same time thus causing a buyer's market?  Why do so many people want to buy homes at the same time thus causing a seller's market?  Are they all brainwashed by the media?  Has supply and demand economics been permanently replaced by media economics?    

July 3, 2007 8:30 PM
Lee Hannibal
Member Since '07

Lee Hannibal said:

I get your point Pete. The media should at least state that Real Estate is local as a disclaimer.

July 3, 2007 8:56 PM
Tim and Susan Fennell
Member Since '06

Tim and Susan Fennell said:

Mark asks, "Did the media also fuel the housing boom?"

I think the answer (to some degree) is yes.  The media didn't create either extreme.  As Mark points out, what we are seeing is a natural economic cycle.  However, the media often blows a naturally occurring event out of proportion.  After all, they have a lot of pages and air time to fill and the headline "THE WORLD CONTINUES TO WORK PRETTY MUCH THE SAME WAY IT ALWAYS HAS" just doesn't grab much reader attention - LOL.  Just look at the way they have grabbed onto the whole 'global warming' thing and turned it into an END OF THE WORLD story... and to think that just a couple of decades ago they had us heading full speed into another ice age.

I have been interviewed several times over the past few weeks for an article that is supposed to run soon (maybe this weekend) in USA Weekend.  When they originally contacted me, they said they were looking for 'success' stories - buyers and sellers who have done well in what is considered a down market.  I provided them with numerous examples and put them in touch with several customers... it will be very interesting to see just how the article turns out.  Will it present the positive side of the story or not?  We will see.

One thing I am absolutely certain of it that the current 'down cycle' will play itself out in due course and the negative stories will die a natural death.  And, of course, whoever is in the whitehouse will get all the credit, deserved or NOT. -- LOL  

July 4, 2007 5:20 AM
Todd Clark
Member Since '06

Todd Clark said:

I'm not sure the media deserves the credit it or not, but they will take it along with who ever is in the white house at the time.

When I have a buyer ask "Why would I buy something that would go down in value after I buy it?" I have simple response to this..."What is the most it could really go down? 15-20% in a bad bad market. You can make that up on your taxes in some cases with home ownership. Did you get that on credit for your $50,000 vehichle you bought last year that is now worth $25,000? Why did you buy that car, it only went down in value? Why didn't you buy a 1956 Bel Aire? They went up in value and cost you about the same?"

They get the point and we sign the contracts.

July 5, 2007 9:09 AM
MJ Langridge
Member Since '07

MJ Langridge said:

LOL , I love the analogy Todd. Your very correct but to convince a buyer of that is hard. I tried to sell a home that appraised at 248,000. We were getting it for 211,000 and that included closing costs. The buyer needed out of her lease  so I agreed to pay up the lease so it could close. The house would have eventually caught up with an upswing of the market, but the buyer was leery. When it came time to close the buyer pulled out. Then said the mortgage broker and I pressured her to buy the home. She got a denial from the mortgage broker because she could not get the first loan she applied for. That is the out for many buyers that just "change their minds" or freak at the end.  I was said the pressure came from me offering to pay the lease up which made it close faster than the buyer expected. So never again will I offer a freebie like that.  So this is a slump in the market but you can buy pre foreclosure homes at a great price, but be careful the buyer still will think they are losing money because the media made the foreclosure story dooms day for the market. So now we can't sell the foreclosures without the thinking they still might lose money. The Seller usually has to pay at the table to make the buyer feel better. The Buyers think then they got a "deal".

But if they compromised and let the Sellers at least come out even the story could have had a happier ending.

Melissa~

July 5, 2007 9:52 AM

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Pete & Theresa Shrader
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Pete & Theresa Shrader
Member Since '07

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