Handling Negative Real Estate Media

One thing is for sure, the media isn’t going out of their way to paint a pretty picture of the real estate market, are they? Now I understand that isn’t the role of media and I am sure many other industries can say “what about the way they treat us?” Auto, pharmaceuticals, politicians and others get the typical “negative” slanted stories because that’s what “sells” in the media. Charity, good deeds and kindness just doesn’t seem to get the headlines very often.

I received an email from an sales associate in my local Coldwell Banker company asking me for some suggestions on how to combat some of the negative news out there about the housing market. This was specifically addressing a recent article by one of the economic sector’s Godfathers – Robert Shiller. Shiller is a Yale University Economist and the co-founder of the Case-Shiller Home Price Index Report.

The article, Yale’s Shiller: Don’t expect a quick rebound in home prices was on the Daily Finance page of AOL.

Here’s a portion of the email I received…

“Hey Sean,

“I struggle a bit with articles like these. I know these aren’t facts for certain..and the economy could perk up..but how do we as trusted advisers advise our buyers to purchase today in this scenario? I worry about the future after doing so…I worry about employing maybe my own tunnel vision or rose colored glassed to get the job done…I know the bottom of a buyers market can’t be predicted..only seen for certain when it’s over..but..”

“Your thoughts??”

Signed, Nervous About the News in New Albany

Here’s my reply…

“Dear Nervous.

Greetings and thanks for sending me this article.

Here’s a few “Sean Carpenter” thoughts plus some other ideas from some of the great trainers I’ve been lucky enough to have learned from for you to ponder.

#1 – “If it bleeds it leads.” Negative news is always more glamorous than the opposite. Take it for what it is.

#2 – I don’t think you have to be wearing “rose colored” glasses but just speak honestly. If you helped a buyer buy a house today and they stayed in it for 3-6 years (the average for ages 25-37) would they benefit by being homeowners over that time frame? The answer is yes – not just from an “investment” view but from a lifestyle view. How much is it worth to them to host their friends for a Fourth of July party? How much is it worth to them to push their stroller up and down the sidewalks on a cool fall night? How much is it worth to them to have neighbors who they can count on to “watch” their property while they are away on a family vacation? Can they get that at their local apartment complex?

Being a homeowner is about way more than “investing” in a piece of real estate.

#3 – If they are selling and moving up, have you explained how this is in their benefit? Buying up in a down market is always a benefit for the seller soon to be a buyer.

#4 – What will they do while they are waiting and these low interest rates slowly creep up to 5.95% or higher? How quietly have gas prices slid up to $2.90? There’s just more in the news own to occupy the media but watch when prices hit $3.01. All of a sudden those with the H1N1 virus will be a couple of unfortunate soles who chose the wrong week to get the Swine Flu.

#5 – Lack of multiple offers – The on-line lender named Lending Tree states that “when lenders compete, you win.” Well, when your buyers compete for a house, they clearly lose. In multiple offer situations, your clients will either pay too much for a house (when emotions take over) or lose on a great opportunity and be upset with you (and the real estate industry for causing their pain).

#6 – Inventory is high right now but that won’t stay that way for ever. If your clients are unencumbered buyers (no home to sell) they hold a lot of power – Not to mention the possibility of $8,000 tax credit in their pockets to use in their negotiations.

Just a few thoughts for you to consider. I hope this helps. Keep focused on your real estate when you can and don’t allow the media or your clients to control your actions or attitudes. Help people see the “big picture” from both sides – their “emotional” side and the neutral “logical” side.

Sean

I’m curious…would you have answered any differently? How would you suggest “Nervous about the News In New Albany” approaches these types of articles in the future?
2 Responses to Handling Negative Real Estate Media
  1. Peter
    June 10, 2009 | 2:40 pm

    The media focuses on "now" information and not “long term” information, because the long term requires consideration while the now only requests a reaction.

    I recently refinanced our home at 5%, which is still unbelievable to me, because my first home was mortgaged at 8.5% and I thought that was great. When interest rates made it to 4.75%, I was asked if I wish I had waited for the better rate. I responded that more often than not, waiting for the rates to drop only leads to lost opportunities. Too many things can change over the two weeks I would have waited for the lower interest rate; banks could have changed lending criteria, the stock market could drop and have an effect on my net worth, I could be called out of town on business and missed the opportunity altogether or the interest rate could have gone the wrong direction.

    Regardless of the rates or the media, in the long term, buying a property is a great investment, but not only from the financial standpoint of owning a house, but also from the aspect of investing yourself into a community, a lifestyle and a home.

  2. Sean M. Carpenter
    June 11, 2009 | 12:49 am

    Thanks Peter. Great inisght into to struggle between gaining today and either losing tomorrow or losing next week.