Sunday, May 10, 2009

How the toddlin' town can do better

The Illinois Association of Realtors released some first quarter 2009 statistics late last week. Like many other local and state realty associations, they released too many. It certainly is not the fault of the realty associations that the real estate market is so challenged, but I again stand by my opinion that their "half empty" approach is not helping matters any.

Borrowing from their just released statistics for the Chicago area, they announced that first quarter home sales dropped more than 26% when compared with a year ago. The median sales price just for the city also dropped more than 26% from last year to this. This information was prominent in the major newspapers and news sources throughout the Chicago area within hours of its being released.

How does this information stimulate activity in the market?

Frankly, it doesn't. Thousands of potential sellers in one of the most important local economies in the USA have just been told the large percentage of a sales reduction compared with a year ago, and could think that those that did manage to sell did so because they sold for a lot less than they had hoped. In most cases, potential sellers also become potential buyers. At least they could be if their motivation wasn't stripped by statistics.

If a news organization or an entity representing another form of large consumer investments (competing for dollars with the real estate market) were to discover and announce this, it would be understandable they would want to discourage people from investing in real estate. But this information, once again, comes from within the industry.

The Illinois Association of Realtors could and should have used their information more strategically than they did. That is their job, rather than pointing out negative statistics just as prominently.

Here is what the Association should have reported, since they have the official statistics to back this up:

"The latest Illinois Association of Realtors statistics, released on Friday, show that 10,306 single family homes and condos were sold in the immediate Chicago area during just the first quarter of 2009. With sales averaging more than 100 homes and condos per day during the January through March period, the median price within the city limits finished the quarter at $216,000. Yet, with suburban homes and condo sales factored in, the area's median price is now at $187,500. The median price is the price at which half of the homes sold for more and half sold for less."

Let me try this again. What the Association actually put out included their statistics about sales and prices dropping more than 26% compared with last year. Not only are those negative and not necessary statistics, but they compare with just over 1 year ago before the economy took its still current turn for the worse.

People looking to buy or sell a home or property don't always care about what happened over a year ago in terms of making decisions today.

Let me add that I am not picking on the Illinois Association of Realtors. Most if not all of the associations have been doing this month after month. Because of the size of the Chicago area, I am merely using this as still another prominent example.

If I were a realty agent, I would be screaming bloody murder to the association(s) I was a member of, demanding to know why negative information keeps getting put out there to a confused public.

Remember the saying - "Good news travels fast". If only the people leading the real estate industry would.

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