BY MIKE CETERA
When you are a member of the media and you meet a real estate agent, there's one thing you can count on hearing: an earful.
A few weeks back, my wife and I were chatting with a couple while waiting for a table at a restaurant. The woman asked what I do; I asked what she does. She told me she was a Realtor, and after I told her we bought and sold property last year with relative ease she suggested that folks in my profession were making the market even more difficult than it already is.
Homebuilders are saying the same thing (via Al's Morning Meeting).
From MarketWatch:
Toll (Brothers) said all the discussion of whether the economy's in recession is dampening the mood of consumers, though it noted "glimmers of hope" in a few markets, including Naples, Fla., and the Washington, D.C., suburbs."Ceaseless talk of a recession continues to dampen the mood of consumers in general, whether or not a recession actually occurs. For home buyers, we believe this drumbeat, coupled with concerns over mortgages, the direction of home prices, and foreclosures, has kept pent-up demand on the sidelines," said Robert Toll, chairman and chief executive, in a statement.
This is a great chicken-vs.-egg argument.
Earlier this week, we reported that home sales had fallen 31.7 percent in January in Kane and Kendall counties.
According to the Aurora Tri-County Association of Realtors, 233 homes were sold last month in Kane County, a 33.4 percent decrease from the same time last year. In Kendall County, 84 homes were sold in January, a 30 percent decrease from the same period in 2007, according to ATCAR, an arm of the Illinois Association of Realtors.Throughout the Chicago area, home sales plunged 34 percent last month. Sales were down 31.1 percent statewide.
My guess is all the grousing by the real estate industry over media reports is less a complaint that news of a downturn is a self-fulfilling prophecy and more a wish journalists would keep quiet about what's really happening.
Can't kill the messenger every time..Here's a summary from a piece by Dmitry Orlov regarding this "little blip"; the original is here:
http://cluborlov.blogspot.com/2008/02/money-as-metaphor.html
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Money as Metaphor
At the start we might have a traditional society, with a largely non-monetized economy, analogous to a healthy working individual, who makes a bit of spending money, and uses it to get drunk (i.e., consume) after work and on holidays.
His liver (economy) is in fine shape, able to process all the alcohol with no ill effects (provide the consumer goods in exchange for money).
Over time, his liquor consumption (spending) increases, and his capacity for work drops (outsourcing).
He now borrows against everything he owns (equity cash-outs), his future earnings (consumer debt) and even the earnings of his unborn children (national debt) in order to continue drinking his fill every night.
Later, his liver becomes enlarged and diseased (bubble economy), is no longer capable of processing all this alcohol, generates back-pressure (commodity price spikes, energy shortages) and even causes black-outs (market crashes).
He can work even less (layoffs), and becomes unable to service his debts (foreclosures, repossessions, defaults).
No longer able to afford all the booze, he goes on the wagon (decrease in consumer confidence and spending), which gives him ‘Delirium Tremens’ (recession, depression).
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It's just starting to get a bit shaky around here..
Of course, it's the media's fault. It's morning in America! Aurora is second to none! There is no recession!
The media should be at fault they mostly write what they hear without printing the facts.In which keeps us all in the dark about what realy was said.The media has become the judge and jury.Why even go to court the media has already found you guilty or not guilty,but mainly guilty.
Come on, you have to be kidding. The media reports the news they don't make the news. Has there been news reported inaccurately---yes, but that is as far as it goes. Investors , bankers, and the financial industry took a huge gamble and they lost... Plain and simple. Now we will pay the piper but things will get better, the world is not ending. Just give it some time mortgage rates will come down along with prices and those that "live within their means " will find homes at more affordable prices.
Mr. Cetera, what community did you purchase your new property in? Most of the Beacon-News editors don't seem to live in Aurora.
Gread is sin. A fat bloated overly competitive society who has to keep up and surpass all of it neighbors is to blame. The builder wants more profit. The houses get bigger and bigger. The realitor gets 7%. The employee needs a raise to pay for that mini castle and Nicor bill. We all have to go to Cancun to sun. We have to pay for daycare and not stay home (No one does that anymore) The children are shooting each other after they tire of their video game babysitter. And the media is to blame? Ask yourself today what can I do without. What is really driving all this lifestyle? This is not the pepsi generation as advertised.