With all the doom and gloom published in the media, here is an interesting POSITIVE perspective from a realtors blog that can really apply to any of our major markets. Don’t let the media determine how your week will be defined. With rates now consistently below 3%, homebuyers can benefit from a full 60 months (or more as 7 and 10 yr terms are also attractive) of historically low payments.
Good or bad, up or down, I don’t mind what the market does, but I’d like for the information out there to be credible!
Let’s take a look at some of the recent headlines and compare notes…
Let’s take a look at the headlines, shall we?
“Canadian Housing Boom Over, Economists Say” – Financial Post, 3/11/2013
“How To Lose Money In Real Estate” – The Globe & Mail, 3/14/2013
“Home Sales Have Plunged Almost 16% In A Year As Price Gains Slow” – National Post, 3/15/2013
“Real Estate Market Shows More Signs of Cooling In February” -Toronto Star, 3/15/2013
“Clouds Gather Over Housing Market” – The Globe & Mail, 3/16/2013
“Housing Market To Remain Tepid” – The Globe & Mail, 3/18/2013
And that’s just from this past weekend.
Many people out there want to see real estate devalued, either because they want to buy a bigger home for less, or because they’re renting, or maybe just because they’ve been predicting the real estate demise for so long.
I’m not doubting hard facts like statistics, but rather the way the stats are being portrayed. For example, “Housing Market Down 16%” has a very different meaning to some people than others. The media often uses this to lead readers to think the prices are down 16%, when in fact it’s sales.
It’s two types of people who buy into the media conjecture:
a) Those who aren’t currently involved in the real estate market
b) Those who really want to believe it
Therein lies the problem.
The point is that those people in the market right now – those who are out there looking at properties, actively searching, and ready to buy, are experiencing something completely different from what the newspaper articles are portraying.
This, from the Globe & Mail:
The flicker of optimism that sparked in Canada’s housing market when January sales outpaced December’s has died out, erased by a notable drop in February.
That’s opinion, dressed up as fact. Is it not?
Since when do January sales not outpace December’s, as they have in Toronto in 5 of the last 7 years?
And what’s this about a drop in February sales? Sales in Toronto are actually up by 32%, Feb/13 over Jan/13 (5759 vs 4375).
You can make numbers say anything you want, right?
Also from the Globe:
The association (CREA) is now forecasting 441,500 sales this year, a decline of 2.9% from 2012. Just two months ago, it had said it expected 447,400 sales this year, and in September it had estimated 457,800 – a figure that it had already cut.
Well, that will teach us for hoping that CREA had a crystal ball! Shame on you, CREA!
The Globe article makes it seem like a forecast is carved in stone! And what’s the big deal about reducing that forecast by (wait for it!) a paltry 1.3%? Hey, if they reduced the forecast from 447,400 to 300,000, then we’d have something to talk about!
Also from the Globe:
CREA now expects a national average of $362,600, down 0.2% from last year.
CALL THE COPS!
A 0.2% drop in house values! Somebody, quick, put me out of my misery!
And don’t forget – this article was called “Clouds Gather Over Housing Market.”
Clouds? Really? People lost 90% on Nortel Networks back in 1999, and those were some cloudy days! Soooo……what do we make of 0.2%?
Well, based on the national average of $362,600, that means the average home-owner is going to lose $725.20, which, clearly, according to the media reports, is enough to make us all jump off a tall building.
The newspapers use words like “plunge” and “plummet,” and those words can’t help but conjure up ideas and images in the heads of readers.
Consider the Chris Rock comedy sketch when he talks about the mis-use of the word “assassinated.” The average person, according to Rock, can’t be “assassinated.” Martin Luther King was “assassinated,” but the average man on the street “just got shot.”
So how can you make reference to a “plunging” housing market, when we see stats like a decrease of 0.2% in prices?
Here’s a good one: “U.S. Style Housing Crash.” Ah yes, the “style,” as though this crash were some kind of dance craze, handbag, or pizza topping.
The people who believe this, and the people who write it, are one in the same: those who want it to happen.
“Here’s what’s going to happen – this supposed slowdown is going to be a distant memory in April, May, and June, when offer dates, multiple offers, and bidding wars are back, and everybody is bitching about how hard it is to buy a house, and the media is glorifying the red-hot market because they write whatever sells papers, and the market-bears will just keep singing the same tune.”
The historical slowdown in March, which we see every year thanks to March Break, Easter, and Passover, will give way to a red-hot spring market, the way it always has, and always does.
But the newspaper articles never seem to differentiate between houses or condos, high end versus low end, Vancouver versus Toronto, or anything that doesn’t take the path of least resistance.
Wait to see what the headlines read in May. Columnists will be crawling over each other to do a story on that happy couple who purchased their dream home in a 17-offer frenzy.
Hey, I’m not saying I like it. In fact, I hate it. I wish it weren’t so.
But I want people to know what’s really going on in the market, because they sure as hell aren’t getting it from the newspapers.