Media not the villain in housing crisis

Please, don’t kill the messenger … especially since I’m one of them.

I know that some people like to blame the media for most everything. But, really, as much as some of the real estate pros would like to, you can’t blame the current housing crisis and subprime lending fallout on the Washington Post, New York Times or Wall Street Journal.

I bring this up because I work in media. I cover both sides of the real estate transaction, writing about buyers and sellers, and the real estate agents and mortgage lenders who serve them. It always surprises me when I interview agents about today’s sluggish home sales and stagnant prices. So many times they’ll tell me that the media has made the housing downturn worse or that reporters haven’t been their friends during this bleak period.

There are a lot of problems with both statements. First, agents are giving the press far too much power. I understand that people think bad news sells papers. But really, it doesn’t. Secondly, the press is not supposed to be the friend of the real estate industry. Newspapers and magazines may have acted that way in the past, but reporters are supposed to be impartial. The media isn’t for you or against you, when it’s working properly.

That last point bears a little thought. We haven’t always been that impartial. If you’re a real estate agent trying to blame the media for making the housing crisis worse, you’d better credit us for boosting your income, too, during the housing industry’s long run of escalating sales prices and quick sales.

Let’s be honest: People in the real estate and mortgage industries should be thrilled with the kind of coverage their industry received during the long housing boom. For years, you couldn’t open a newspaper’s real estate section without reading about what a wonderful investment real estate was. Remember all those news stories filled with experts boasting about how people would be foolish to sink their money in an unreliable stock market? How many times had you read during the housing boom about how real estate always, always appreciates over the long haul; or how easy it was to cash in by flipping a house? To be honest, the press — stories of a possible housing bubble notwithstanding — failed in its role of watchdog.

So, no, you can’t blame the media for all those foreclosures and defaults we’re seeing now. Those foreclosure rates aren’t just “spin.” They’re real. You can read about them here, the Web site for National Public Radio. And if you’re a real glutton for punishment, you can read about it here, too, at the Washington Post. These stories are a bit old, so the rates may be even higher.

Of course, they may be lower, too. See? We in the media are all about being fair. Don’t blame us for this crisis.

Home sales are down, it’s not just a negative spin. Again, you can read about this. This time it’s straight from the National Association of Realtors here.

The truth is, no one should be surprised by the current downturn in the residential real estate market. Housing prices in many areas of the country rose too high too fast. That had to stop. It was inevitable. It’s also inevitable that this crisis is only a temporary thing, an adjustment. The smart real estate agents whom I interview – and there are a lot more smart ones, by the way – know this. They know that a stronger real estate market will return. It’s just a matter of time. They also know that even this down market with its high foreclosure rates, declining home sales and stagnant prices has a silver lining: If you’re a buyer – and you don’t have any home of your own to sell – this is a phenomenal market. You won’t have to worry about bidding wars for that house you want. There’s no reason for you to overpay. And you can even take some time to think about your decision before putting in your offer.

If you need a second opinion on my take on the media and the current housing problems, read this column in Realty Times. Its author, Broderick Perkins, knows the industry. He knows, too, that real estate professionals can’t pin their current problems on the press.

As far as me, I’m the new Property Crossroads blogger here at b5media. I’ll be posting near daily here about the up-and-down world of residential real estate. It’s a fascinating topic, and one I’ve been covering for about 10 years now as a freelance writer and editor. My hope is to give you the straight news about the industry. There are a lot of myths about buying and selling homes out there. I’d like to give you the real truth. So check back often. I’ll be here.