Thursday, July 29, 2010

Mass media reporting is real estate's worst enemy

The Public Has Questions
I had an interesting conversation with a stranger yesterday who I met while running errands. I was wearing my Coldwell Banker polo shirt so the person wanted to ask questions. All the questions were aimed at getting a reality check about reports in the media about short sales, foreclosures, interest rates, etc.

News Stories Are Deceptive
The person had the impression, based on media reports, that short sales and foreclosures were a major issue in Silicon Valley. That's flat out wrong. Both short sales and foreclosures have been dropping, "shadow inventory" is not increasing, and sales remain strong throughout the area. After explaining the facts and citing real figures from the MLS, she was upset.

What's The Real Story?
Her anger was focused on why the media portray one image while reality is so different. What I told her was the media tends to:

- generalize their statements and include stats for an entire region or the country
- make notices of default equal foreclosures
- speculate with statements such as "...millions of homeowners could..."

This story today on MSNBC:
http://www.msnbc.msn.com/id/38457609/ns/business-real_estate/
is a prime example where the writer is using notices of default (NOD) to make it sound like foreclosures themselves are actually coming soon. In reality, earlier reports of actual foreclosures show they're dropping in most areas.

Truth Lay With Bloggers
In my opinion, the local real estate professionals blogging about their local area can give a much more accurate picture of short sales and foreclosures. I encourage all of us to write the truth and fight the mass media. The deception and lies in the mass media are hurting our markets and buyer/seller confidence.

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