I have a beef with the media. Because of sensational reporting that is done to get ratings, I don't get to spend my time educating consumers on the real estate market, I spend time RE-educating them. I have to first un-do the harm done before I can give my clients the correct, most up to date information that is relevant to the community in which they live.
Here's an example: Both of these articles ran on June 25th, 2007.
CNN.com said: "Home sales slumped to a four-year low in May as prices slid further and the glut of homes on the market hit a 15-year high, a real estate group said Monday, noting buyers are being scared away by the weak housing market."
Realtytimes.com said:"Real estate is set for an upswing based on indicators such as home supply, interest rates and employment. Not only has it never been easier to find and afford that dream home than right now, but real estate remains one of the best long-term investment options."
Now, as a bright, internet savvy consumer which one of these stories are you going to believe? Frankly it doesn't matter which one you pick because neither one of them are giving you information that can help you be a savvy consumer if you are buying or selling a home in Minneapolis. Neither one of the above articles mentions the real estate market in Minnesota, Minneapolis, or Nokomis. Everything about real estate is local.
I'm not accusing CNN or RealtyTimes for misleading consumers with their interpretation of statistics. I am accusing the media-in general-of misleading consumers by i) doing an insufficient job of disclosing where they get their statistics, and ii) not including a disclaimer that their national, generalized statements about the real estate apply to my neighbors in Nokomis and Longfellow...or any other local market. Simple matter is their report has a 50-50 chance of applying to ANY local market.
(Dear Media, it's no fun when someone makes generalizations that may or may not be correct, hunh?)
Here are 3 tips to help you decipher whether you should listen to chicken little spewing statistics that prove the real estate sky is falling.
1) Know WHERE the statistics are coming from. If it's from the National Association of Realtors (NAR)you probably want to be a little cautious. Don't get me wrong, NAR has the most comprehensive data available on the real estate market. But that's the problem. It's comprhensive and includes information from all over the country. NAR is not going to tell you how many days it takes a home in Nokomis to sell (86.4 as of today), or the median home price of homes that sold in Longfellow (236,000). If it's from our Regional Multiple Listing System, or from the Minnesota Association of Realtors, or the Minneapolis Area Association of Realtors, you'll be getting information much more relevant to your situation.
2) As soon as you know where the information came from, ask another question on where the information came from. Above I told you it took 86.4 days for a home in Nokomis to sell. Here are some other questions for you to ask: Is that all single family homes or does it include townhomes and condominiums in Nokomis? Does that include price ranges from $55,000 to $2,000,000 or was the price range narrowed to come up with that number? Is that for all 3 bedroom 2 bath homes, or does it include 1 bedroom 1 bath homes?
Depending on how I run a report from the Regional Mulitple Listing Service, I can get very different information.
3) If the information is from a study that was done, find out who paid for the study. Then ask if that sponsor has any vested interest in the outcome of the study. THEN you'll have your answer on how much credence to give to the study.
Submitted for review by my neighbors in Minneapolis
Lisa Dunn, Edina Realty REALTOR, and South Minneapolis Resident
Other Articles by Lisa
The biggest myth about selling your home
4 ways to increase your chance of a multiple offer