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Are Media Reports Negatively Influencing Real Estate?
In the world of news, entertainment, and whatever else is making headlines these days, the media is the filter in which everything is absorbed and then recycled into the information that is sent to consumers for consumption. Otherwise known as information overload. Since repetition is the key to learning, we remember what is repeated over and over.
The Bullseye Is On Real Estate
Real Estate has been a very easy target, due to it being national in scope and affecting so many people and industries. Most all of the news being reported today about real estate is negative. It has been a cornucopia of events starting with sub-prime, fewer number of home sales, foreclosures, lack of liquidity in the housing market, harder to obtain financing.
Consumers have been inundated with bad news regarding the real estate market. Despite the best efforts of the NAR and their Good Time to Buy campaign home sales remain very sluggish. In today’s LA Times, syndicated columnist Lew Sichelman provides a list of reasons why now is an excellent time to be a home buyer. Despite this rationale and justification, home buyers are still sitting on the sidelines.
Consumers Are Media Directed
We as consumers tend to believe what we see or hear in the media. There is a certain amount of credibility associated with it. Maybe we don’t have the time or resources to adequately research what is presented. I have seen two different news accounts on the same issue which leave you bewildered and recognizing that one account did not adequately present the whole story.
Does presenting the negative aspect of an issue make for better reading? Evidently so. The heard mentality seems to support this premise. Very few of us can adopt a contrarian philosophy, even though this can often times create the biggest opportunities. When everyone else is selling, you’re buying.
Spin It To Win It
As they say, there are two sides to every story. We are all pretty much familiar with the one side we have been reading about for the last 12 months. However what if these were the new headlines?
- Foreclosures Create Fantastic Buying Opportunities
- Homes are Becoming Affordable Again
- More Homes on the Market, More Choices for Consumers
- Sellers Say “Show Me An Offer”
- Seller Financing, No Reasonable Offer Refused
- Home Sellers Now Agreeing to Buyers Requests
- Low Rates, Lower Home Prices, More Home For the Money
In sales 101 you are always taught to take a negative and turn it into a positive. If the headlines were reported in this manner, wouldn’t it change people’s perception?
And then again, isn’t perception reality?
February 24th, 2008 at 2:55 pm
I think you are definitely right Doug. Psychological aspects of business cycles are indisputable. And power of media to influence psychology of the masses is indisputable too. Media have really big power in our whole society and we have to ask, in which way are they using it. Maybe few headlines (like yours at the end of article| would be enough to twist the trend, but positive headlines are not friendly with newspaper’s marketing.
We are in the bussiness for 15 years (pretty busy years - Toronto real estate) so we wide experiences with media’s “announcments” and rumours…
February 24th, 2008 at 11:46 pm
It is very interesting to think about! Just how much influence does the media have on everything?
February 25th, 2008 at 12:37 pm
Great story Doug, and I couldn’t agree more. There is always a bright side to every market cycle. We need to highlight the positives as much as possible. We have to be realists and look at the facts, but we also have to be optimistic and seize the opportunities out there. If we don’t stand up and shout, no one will. In my option, this is one of the best markets for buyers in decades.
February 26th, 2008 at 7:05 pm
Great post Doug! Most people don’t get beyond the headlines or the “Headline News” version of events. We’re all so busy and inundated with information, and it’s hard to find the time to fully educate ourselves. Unfortunately, negative headlines about the real estate industry (like today’s “foreclosure spike”) simply scare off buyers and perpetuate the declining market. We’ve all heard, “if it bleeds, it leads.” The media aren’t going to change their tactics. It’s up to us in the real estate industry to change perceptions and educate consumers about the great opportunities that are out there; and to put the numbers that are making headlines into context. We also need to reassure sellers and let them know that real estate truly is cyclical. Just look at media reports from ’85 and ’96, for example. Thanks for starting this discussion.
March 2nd, 2008 at 11:53 pm
[…] is so much information available in the media regarding the real estate market. Its very difficult to open the paper or turn on the local or […]