Extra Extra: Is the real estate market crashing? (Speech prepared for Toastmasters)

Extra

I came across an article in the Globe and Mail.  The headline read, “Clouds gather over Canadian Housing Market[1]”.

Wait, what?? What clouds??

What’s next, lightning, hail, tsunami?? Lake Ontario overflows and half the city is under water!! The housing market crashes as Torontonians evacuate!

Ok, Globe and Mail. It’s time to stop scaring my Buyers. These days I feel more like a psychologist than a real estate agent. I spend a lot of time reassuring stressed out, fearful clients.

Madame Toastmaster, Fellow Toastmasters, and Welcomed Guests,

Next time you see a headline like this, please take it with a grain of salt. Here are four reasons why:

1. Articles can be sensationalized.

Many writers use fear tactics to sell their articles.  A hard-hitting and controversial headline is attention grabbing and sells newspapers. Like Globe and Mail’s March headline that read “One word to describe Toronto’s real estate market: It starts with an F[2]”.

Toronto Life wrote the following line: “The house hunt has become a blood sport involving bully bids, bribery and a willingness to pay $100,000 over asking, without conditions, for the ugliest address on the street” [3].

Toronto Life, please don’t tell my Buyers that they’re going to end up bloody and swindled, the remorseful owners of an ugly house. I would never let this happen. I make sure my clients’ experience is PLEASANT. Ask any one of them.

2. Articles are sometimes published too late.

I don’t know how many articles I’ve read about a bidding war  for a specific address that occurred a season earlier.

3. Articles sometimes manipulate data.

You can make numbers say anything. There’s a lot of data out there, and when writers have a certain angle, they may omit certain numbers. If you read somewhere that the market has gone up by 6.5%, don’t just take that number at face value.  Does 6.5% mean sales are up, or does it mean prices are up. Is it for condo sales or for freehold sales? Is it for downtown Toronto or the GTA? Is it 6.5% more volume this month? Or 6.5% since the same time last year?

If I read that real estate sales have plummeted in July and August, I’m going to go crazy. It’s called seasonality and it happens every year.

4. Articles sometimes contain data from unreliable sources.

The only data my clients need to worry about is their own financial data and whether of not the can afford the monthly mortgage payments and maintenance fees, and property taxes.

For the record, the market is NOT crashing. To those of you who are wondering if and when the market will crash, I would suggest you stop speculating. In my opinion, speculating is like gambling. You don’t really know what you’re doing.

If you want to buy, then buy. If you don’t want to buy, then don’t buy. Just don’t fall victim to the Chicken Little Syndrome: The sky is falling, the sky is falling!  The sky is not falling and neither is the real estate market.

 

 

Disclaimer: The preceding commentary is the opinion of Hanna Stecewicz and does not represent the interests or opinions of Right at Home Realty Inc., Brokerage or the Toronto Real Estate Board. Therefore, Right at Home Realty will not be held responsible and/or liable for any of the opinions herein.

 

 

 



[1] http://www.theglobeandmail.com/report-on-business/economy/housing/clouds-gather-over-canadian-housing-market/article9812647/

[2]http://www.theglobeandmail.com/life/home-and-garden/real-estate/one-word-to-describe-torontos-real-estate-market-it-starts-with-an-f/article9759374/

[3] http://www.torontolife.com/daily/informer/features/2012/08/29/real-estate-bidding-wars/

Be Sociable, Share!

0 comments ↓

There are no comments yet...Kick things off by filling out the form below.

Leave a Comment