Did the Media Create Today's Real Estate Market?

Dare we say that the media created a panic? Could this be a self-fulfilling prophecy? Interest rates were low, houses were pending, selection was excellent, loan programs were available, new homes offered amenities and the construction industry was strong....that is when the stories began. No, they didn't begin when the houses were sitting on the market for hundreds of days. They didn't begin when the sub-prime market took a huge hit. They didn't begin because of interest rates climbing. There is a harsh reality here. Last February our local paper reported that closed sales were down. The story focused on the changes in the market. At the end of the article it discusses how pending sales were up. Pending sales usually turn into closed sales, correct? But this wasn't their focus. Their focus was, and continued to be, the doom and gloom of the real estate market.

We watched 2007s market get compared to the last few years. Why? Why just the last few years? The last few years were not normal. Why not compare to normal years. Buyers, sellers, Realtors, Lenders and many others knew that the market would not continue to appreciate as it had done in the last few years. The slow down was positive. This allowed buyers the opportunity to purchase the home they really wanted at a much more reasonable price without having to enter a bidding war. Buyers were given the opportunity to look at multiple homes prior to making a decision. Interest rates were still extremely low. The slight climb definitely wasn't a huge increase. The interest rates that we had seen previously were record lows. Record lows aren't meant to last.