Wednesday, August 4, 2010

Chicken Little and Media...

If you're anything like me, you're a compulsive news reader. I have a love-hate relationship with news-media. I feel it is very important to be in touch with the world around me, as it impacts my business on a day-to-day basis, as well as shaping the future of my marketing avenues, and business planning, however, it can be very difficult to overcome the overwhelming, and CONSTANT negativity in the news.

At this time I am in a position, thanks to some wonderful Realtors and Industry analysts, to repeat a prediction that I encountered recently. Brace yourself for it - THERE WILL BE NEGATIVE MEDIA regarding the Real Estate market, very shortly. Yes, I know, this is a shocking revelation!

My goal today is to soften the impact of this sensationalist media by preparing you. By arming you with the facts.

Most of this content is "borrowed" from a gentleman named Doug Hannan, who is a Broker/Manager for RE/MAX West on Bloor st in Toronto (Another universe in Real Estate land, but nevertheless, seemingly the sole focus of real estate media in Ontario).

Doug obviously follows the Toronto Real Estate Market very closely. He has noted that in the month of July. TREB's (Toronto Real Estate Board) sales numbers were slightly lower than expected. He also noted that inventory had dropped a proportional amount, indicating balance in the market. Sales for the month were 6,566 units, down 1,900 from June of the same year (a typical seasonal drop - Vacation time!!). New listings this month are down 3,000 units to 21,096. It is to be noted that RE/MAX Realtors have been predicting a decrease in inventory since late 2009.

Where the media sensationalists will galvanize, is in the Year over Year numbers. It stands to reason that a July 2009 vs. July 2010 drop in sales of 35% would yield some alarm bells, but I am predicting that the media will have a decidedly un-elephant-like memory. They will fail to note (as they have previously failed to note) that July of 2009 was an absolutely ABNORMAL month, even in an extremely hot year. July 2009 Sales set a record at 9,967 sales (up 28% from July 2008). Benchmarking against the best July of ALL TIME is an unfair method of assessing the health of our market. The media won't mention this, save for a tiny disclaimer at the end of their "Real Estate Bubble is HERE, the sky is falling, depreciation is just around the corner, thousands to be left over-leveraged on inflated prices" reports.

The Sky is not falling, friends. Balance and sustainable growth will be the cornerstone of the immediate Real Estate market.

Thanks Doug - for the insight!

To Reach Doug Hannan of Re/Max West, try this:

Thanks for reading!

Ben Sage, Sales Representative. Re/Max a-b Realty Ltd., Brokerage. 519-536-7535. 521 Dundas St., Woodstock, ON

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