If you're like me, you're getting a little frustrated with the media's reporting on the current housing market. It's a mess, a crisis, a disaster- I've heard it all. I understand that sensationalism sells, but the real problem is that the information reporters rely upon to make these dire assumptions is often inaccurate.

The good news is that some reporters are finally figuring it out! On May 1, MarketWatch carried a story written by Chris Pummer, a respected financial reporter, who contributes to many mainstream newspapers. In his report, "Home Price Data has its Flaws," he noted that the much relied upon S&P Case-Shiller Home Price Index might be giving "imprecise readings of price changes at all levels."

Pummer also noted that most surveys don't agree and that many are flawed by their assumptions, and are using negative hyperbole when describing our current market. It has also been reported that S&P had admitted that their report may "paint an incomplete picture." Really, you think so?

On May 6 The Wall Street Journal printed a guest editorial by hedge fund manager Cyril Moulle-Berteaux entitled, "The Housing Crisis is Over." His premise was that April 2008 could very well mark the bottom of this market, but he emphasized that a bottom doesn't mean that we'll instantly return to 2005, but that "the trend is no longer getting worse."

Moulle-Bertreaux bases his conclusion on the affordability of housing today, the price versus household income. He also says the so called "experts" who say the market has another 30% to drop are making a "simplistic analysis that is appealing on the surface, but is flawed for a variety of reasons."

I have always said that the housing market is like the stock market, no one can predict an exact high or low. At the same time, I am encouraged today by reports from our Affiliates around the country that lead me to believe we are near a bottom. It could take until the end of the year to know for sure if things are turning around, but in the meantime, we could certainly use more accurate and sensible reporting on the situation.

But tell me what you think? Have we hit bottom? What's it like in your market? Post a message to my blog and let everyone know how things look from your view point.

Also, I would encourage you to read the two articles that are linked above and pass the word - the sky is NOT falling down and there's never been a better time to buy a house. Dave

Copyright © 2008 RE/MAX International Inc. 5/12/08

Comments: (17)

Dave, It seems as if people are not aware that we just have to work harder as agents. The buyers no longer come to us we have to find them-It's like fishing you can't sit on the pond for 10 years in the same spot and catch the same amount of fish everyday-You have to move around and watch the change- Just like the market-If you are working you are making money. Think positive and you will do fine!
Gerri L. Walczak, RE/MAX Central, Toledo, OH

Dave, I believe the housing market price declines have hit bottom in the Western Cleveland area market. Homes are selling closer to their original asking prices than anytime during the past 2 years (our declining market began about April 2005). The number of homes "on the market" vs. the number of homes "going under contract" has stabilized (beginning about April, 2005 the number of homes "on the market" began to increase even though the number of "homes under contract" stayed steady with previous years). In fact the number of homes under contract held steady (season-to-season) every year since 2002 until October, 2007 (resultant from black Monday - August 20, 2007). The good news is that the supply side has become steady and the sell side seems to be returning, although it is too early to know the latter. The negative is that until we return to the supply side levels of 2003 we see no appreciation of value. In this area that will probably take 3 to 5 years.
Ken and Lois Kodger, RE/MAX Homeward Bound, Sheffield, OH

Hello Dave, We are doing well here in this market! I ask the Agents at our Office to please avoid what the 6 o'clock prophets are saying. You can talk yourself into anything. We are selling like it's hot, because it is!! While I have only been in the business 16 years and have not experienced some of the markets you have, I have certainly experienced a lot of change over the years. It is truly a wonderful time to buy a home. Also in this current market as long as you have owned your home for 3 years plus, it's also a good time to sell!! We are too blessed to be stressed.
Tina Holt, RE/MAX Coastal Realty, Camden NC

Thanks for your wisdom and encouragement, Dave. I've attached the report I gave to the Orlando Regional Realtor Association in April of this year. The news in Orlando has many discouraged, but we have to keep publicizing the truth to those who will benefit from it. First time home buyers and move up buyers are both benefiting tremendously now. And we keep telling people to move before the prices and interest rates increase. I am so bullish on the market that we bought a brand new home for ourselves and took 25% off the price of a "to be built" home last August. It is ready next week to move into, and my wife and I are thrilled that we can have a better home for only incrementally more than we are paying now! Great agents and brokers are worth their weight in platinum now because despite all the electronic information sources, no one has a better handle on the market than your local RE/MAX agents. Thanks for your inspiration.
Gary Balanoff, RE/MAX Select, Oviedo, FL

Hi Dave, It seems that the media driven frenzy that you spoke of in your blog is similar to what we are experiencing here! Same message just a different part of the world! Our media has for the last two or so years predicted there would be a slump in the real estate market but all anyone needs to do is check out the cycle that real estate has always followed & you don't need to be even a baby Einstein to work it out! At some point, and in New Zealand, the cycle is roughly a seven year one, the market will go down and then at another point, guess what, it will go up again. The interesting thing is that when it goes back up it always goes up further than where it was before. I don't understand what is it that persuades the public that the media knows everything and is accurate and (dare I say it) truthful, in how and what they report. Anyway just wanted to let you know that we are experiencing many similar issues here in New Zealand and for those who have been in the industry for longer than six or seven years you may appreciate what I am about to say - this market is what true real estate is about and we really do have to work hard to earn our commission and hone and develop our negotiating and marketing skills and become better at what we do. Those who continue to work the way they did when listings and sales virtually landed in their lap won't make it but those who follow the old adage "when the going gets tough the tough get going" will shine through to see and excel in the next inevitable cycle in the real estate market. Thanks for listening - kind regards
Christine Lukacs Areinz, RE/MAX Future Mreinz, Auckland, New Zealand

Dave, I agree that it is frustrating to listen to the media. They always emphasize the negative. We need to get the good news out there. Maybe RE/MAX could produce a commercial that emphasizes some of the good news about the housing market. Thanks for all you do!
Kathy Harrison, Re/Max Truman Lake, Clinton, MO

Dave, Thank you for your insights, you are a great leader. I really enjoyed you at the convention, roll up your sleeves, we are the pros we can get the job done even when times are tough! In the Heartland of America we are moving along! Lots of FHA loans, not as many buyers in the upper end here that is $400,000+ but that is coming around. It's going to be a good year!
Pat Hill, RE/MAX First Realtors, Leawood, KS

I read the same Wall Street Journal article and I think it is the most accurate description I have seen that relates to market conditions in our area. We have had more new sales in the last eight weeks than we had in the previous 4 months combined. We are even seeing a few multiple offers. I think prices have slid about as far as they are going to in our areas and the buyers are starting to realize that. Unfortunately all of the data that the media picks up doesn't, reflect this change because of the escrow lag time. Once these escrows start closing I think we will see more positive data reports. Our major problem right now is getting loans funded. We are back to the good old days where the buyer has to have a down payment and a job. That is a challenge, but the bigger problem is there are so few lenders who are making home loans in our area, that they are bogged down and it is taking a lot longer to get funding. I had not seen an FHA loan in several years and now we are seeing them all the time. Bottom line, THINGS ARE GETTING BETTER IN CALIFORNIA at least in our area. There is light at the end of the tunnel.
Gary Stager, RE/MAX Palos Verdes/Execs, Rancho Palos Verdes, CA

Dave, I enjoy your perspective and insights on the market. In Irvine, California it looks like the bottom was in February 2008. We are seeing a steady increase in pending sales and a decrease in inventory. At the same time the foreclosures that have a combination of a deeply discounted price and good condition are selling quickly with multiple offers sometimes for more than asking price. I think we will have confirmation of the bottom by the end of July when we find out how many of the short sales that were placed in escrow without lender approval either close or fall out. By the way, Brian Buffini gave a terrific seminar last night. He gave some very helpful insights from real estate market history for motivating ourselves and our clients.
Fred Currie, RE/MAX Premier Realty, Irvine, CA

Dave, the first two paragraphs (of your blog) sound very much like you don't think we are at the bottom (ie. wait, wait, wait, you'll get a better deal later). Then you end it with a moderately strong close saying "the sky is NOT falling down, and there's never been a better time to buy". This is what the public needs to hear. Why not emphasize it, talk about how in many areas, houses are selling for 40%, 50%, 60% of previous values and this represents and amazing time to steal property for less than a builder can build for. The smart ones are buying now and will reap huge rewards in the future. Thank you so much for being great leaders and listening to us as we move forward towards continued success. I trust you will find a way to truly lead us above the crowd. REMAX really does have the best agents in the business and now we just need to stand up, be noticed and crush the competition.
Alden Frostad, RE/MAX Premier Services, Sarasota, FL

I've been in this business 20 years and I learned a long time ago that markets rise and fall, come and go. But as long as there is activity, ie: buying in a buyers market and selling in a seller market, real estate agents are busy. It is an inactive market that we professionals struggle in. We were in a sellers market in 2005, 2006 and we will be in a buyers market in 2009 if not earlier. This period of inactivity where buyers are waiting to find the elusive bottom is almost past. Get ready folks. The bumper buyer crop is about to descend on you.
Paul Blumenstetter, RE/MAX Integrity, Issaquah, WA

Years ago I learned this from a real estate trainer: "don't worry about things you can't do anything about." So I don't. I believe Realtors should set their VISION on what they want to happen in their business and go for it and not allow anything to distract them. There are people buying and selling everyday. Set a GOAL, and get to work. Whatever you give energy to grows - give energy to the goal and watch what happens.
Jeanny Campbell, RE/MAX Realty Plus, Sebring, Florida

No matter what the national media say (good or bad), the real answers are found at the local level. A national real estate forecast is about as accurate as a national weather forecast. Thank you for picking up on that and throwing the feedback to the local professionals. The one frustration I have had with the median home price indicator is that it has not taken into account the drop in the number of homes sold and the size of the home being sold. I am a strong believer in looking at $/Sq ft in the market place. In the Metro DC market, we are seeing the market absorption rates rising, which I see as a great sign compared to the absorption rates in July-Sept 2007.
Joe Buffington, RE/MAX Realty Centre, Olney, MD

Hi, Dave; When the conversation turns to the 'down' market I always get a wide-eyed response when I ask that if the market is so bad and housing is so down, has anyone visited their local Lowe's or Home Depot lately and did they get 20% or 30% off on 2 x4's, faucets, or nails? It suddenly dawns on them that the costs of building haven't dropped an iota during this media-fired crunch. Once the inventory of available homes catches up again with the pent-up demand, and it will, there is no intelligent reason to think home prices in most of the markets won't stabilize. The smart people are out buying and tying down these wonderful 30 year mortgages.
Susan Landing, Broker/CO-owner, RE/MAX Preferred Partners, Edwardsville, IL

Hi Dave, I love to read about great changes in the real estate market. And your blog is right on target that the market is starting to see signs of change. We are starting to see a change in the Tampa, Florida market area. We have seen a 27% increase in sales March over Feb 2008 in the Brandon/Riverview/South Shore area of Hillsborough County Florida our office market area. The Florida Associate of Realtors reported a 10% increase in sales for the State for the same time period. If this trend continues we should have a great home selling/buying summer.
Ed Pichette, Broker/Owner, RE/MAX South Shore Realty, Riverview, FL

Hey Dave, Great read of your blog this morning. The following article appeared in our local newspaper this weekend  "Sales Surge for Fourth Consecutive Month," by Zach Fox of The Californian. Several months ago I wrote an email to this reporter after he incorrectly quoted stats from our local MLS, regarding how "bad" it was. It was not as bad as he had indicated. I think after my email and subsequent conversation.this particular reporter has changed his slant on reporting news about Real Estate. This is the second article written by this reporter in the last 30 days, showing great positive news. (There was some negative news in the article, but the beginning and mostly throughout there was positive news, encouraging buyers to act now). I would encourage agents throughout the network to have similar dialogues with local reporters.
David Weldon, RE/MAX Elite Team, Temecula, CA

Dave, If you are visiting the regions, please consider a European tour in your schedule. We would certain benefit from your insights and I am sure there would be plenty of questions on how to deal with the local property markets over here.
Duncan Edwards, RE/MAX Energy, Morriston, Swansea