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 I'm Your Local Expert 
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Media hype or real market statistics...which do you believe?
4/7/2008 at 12:57 PM - Regional Markets - New York Metro Area
"The Bubble Has Burst!" says one newscast. "Recession is Upon Us." reads a newspaper headline. "Real Estate Market Worst Since WWI" proclaims another. The major news companies would have us believe that the world as we know it is coming to an end...at least from a real estate perspective. You'd have to look pretty hard to find all the positive 2007 statistics. But they're there. Buried in fine print on one of the back pages. Or lost during the commercial breaks of the nightly news. 2007 was one of the busiest years since the number of real estate transactions have been recorded. (2006 was #1, 2005 was #2) Property values are still up from 2001 in most places across the country!
There are too many "professional" reporters and statisticians talking about an industry other than their own. Few of the doom sayers have quoted actual statistics. The Shiller report doesn't track the whole country, only certain towns in certain states. One of the "towns" Shiller uses in the report is a trailor park in New York State (although he says that's representative of New York City).
The truth is, the market is very local. It's probably one of the most regionalized marketplaces of all. How many times have you heard, "If this house were in _______town, it'd be worth twice as much."? This only reinforces the fact that the layperson understands the differences in values and the importance of local information. Blanket statements don't work. And yet, the news providers insult America daily by reporting gloom and doom across every state and local border. New York City is a world unto itself. Our market is different. Boise Idaho doesn't have foreign investors buying real estate. Casper, Wyoming isn't the City that never sleeps. Rugby, North Dakota isn't NYC! Why would their stats be the same? How could their stats be indicative of NYC? Or any other town or city for that matter?
Interest rates are very low. Is it more difficult to get a mortgage? Not for the person who would have qualified in 2001. Lenders got sloppy and greedy. They approved people with no income, histories of bankruptcies, too much debt, etc. No wonder the mortgage industry fell apart. No one was watching the store!
Should you sell or buy now? It depends on your situation and location. No one should make blanket statements. If you're thinking of moving, talk to a reputable real estate agent and a reputable mortgage counselor. Only the agent can advise you of what's really happening in the market. Only a mortgage counselor can talk to you about financing options.
It may not be the right time for you! Do your research. If you're going to look at statistics, my advice would be to request statistics from the tax office or the MLS. Those sources have to be authentic. It's public information. Don't believe the media hype. Don't believe their yellow journalism in order to get ratings!
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Nice post John! You make some great points.
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