I was checking the national business news on my iPhone yesterday at my Honolulu home and was troubled by the apparent conflict of headlines and news stories. It’s become very difficult to know what to believe anymore about the housing market, both in the near and long term. Look at this screen shot I took:
So what’s an investor or homebuyer to think? The first two headlines seem positive: home sales are rising and mortgages rates are dropping. What about the last two? Demand for new loans is dropping while people are falling out of government assistance programs and are likely headed to short sale or foreclosure scenarios. Not so positive.
Now if you dig deeper you can find some legitimate answers (supposedly) to back up each of these headlines, but I think most of us really just want to know the big picture, the broader scenario to present the context for our decision-making. However, the news outlets don’t make it easy. In fact they are experts at creating confusion. Case in point: that same morning while I was browsing on my iPhone I came across this article:
Ok, new home sales and prices rose in November. Yay! Housing market is rebounding, right? Wait… the very next question you should ask is: what did it rise FROM? “The increase follows a dismal October sales pace…” So we’re better but we’re still not good? Yes, that’s kind of the message. But here’s what REALLY grinds my gears – look at the next screen capture.
In that very SAME article — with the headline that new home sales and price rose — we are told that the “median price for a home sold in November fell to $213,000”. It FELL. But didn’t the headline say they ROSE? Now we’re getting into semantics. Is it only sales and prices of newly constructed homes that rose while the overall median price actually fell?
It’s this kind of statistical manipulation of the facts that really ticks me off because it only serves to create confusion, which inevitably leads to frustration and ultimately anger among good people in Hawaii who just want simple answers. I’m not trying to absolve us of the responsibility of self-education, but when our news sources are constantly sending mixed or outright contradictory messages, what’s a person to do?
It made me think about other sources of information out there, both good and bad. I think the media outlets are generally both: there are quality sources and some that just seem to stir things up. But what about the advice you take from others? If you’re a Hawaii real estate investor, do you listen to other investors around you? If you’re in the market for a house here on the islands, who do you listen to? Realtors? Be careful of real estate agents who will tell you to ‘buy, buy, buy’ no matter what the market is doing (or your own financial situation) because it’s a tough world out there now for realtors (not all, of course). Websites? Magazines? Specialty publications like Pacific Business News? Do you trust your own gut / instincts?
Share your knowledge and leave your opinions below….