Media Predictions Or Myths - March 2023
March 24, 2023 / Written by Rich Harvey
By Guest Blogger, Terry Ryder, founder,
hotspotting.com.au and propertyU
Many Australians are misinformed about real estate matters to a degree that is alarming.
I find in my day-to-day dealings with consumers throughout Australia that most people hold views about the state of play with property markets which are based on misinformation.
People, unfortunately, believe what they read and hear in mainstream media.
They should know better, perhaps, but they think that information is credible if it’s published in a newspaper they like or if the source of the information is a big-name organisation or an individual with a fancy title.
The reality is very different.
Most of what is published in mainstream media is a recycled press release. Indeed, almost every article presented in media about housing markets results from a journalist receiving a press release from an individual or a company seeking publicity for themselves.
A press release, by definition, is a piece of propaganda.
The people who write and issue the press release hoping it will be published by the media, have a vested interest in the message, in some form or other.
The content of a press release is not news. And it is not necessarily factual.
It’s propaganda or a pitch from someone with a vested interest.
Yet, many journalists publish this material as fact. They present it as news.
And consumers absorb the content and believe it to be real and credible.
Even more alarming, often they base important financial decisions on this misinformation.
Every day I hear consumers making statements about real estate which they think are facts but which, very often, constitute misinformation.
There is probably no better example of people making bad decisions based on media misinformation, fed by non-experts like bank economists, than the decisions made by so many people NOT to buy the real estate, as they had planned to do, in 2020.
They believed media rhetoric that the economy was collapsing in the wake of the pandemic, that unemployment was rising, that prices were heading south and that 20 or 25 percent decreases in property values were under way.
By the time everyone realised that the media was wrong about all that, prices had RISEN considerably, a national property boom was under way and those people who deferred decisions to buy missed out on capital growth described in six figure numbers.
We have similar scenarios right now, with constant media claims that prices are crashing and/or will crash in 2023. The data simply does support these claims. Look at the latest figures from PropTrack, Domain or SQM Research and observe that many markets have recorded (moderate) price rises recently and any price decline in specific locations has been quite minor.
But there are many other examples of misinformation accepted by consumers as fact.
There is a very long list of subjects on which the media has presented, as fact, information which subsequently been shown to be misinformation. In some cases, there are items of misinformation that are repeated as fact in media almost every day.
Here’s a short list of misinformation subjects, frequently presented as fact by news media but which I believe to be absolutely and utterly wrong:-
- That there is such a thing as “the Australian property market” which can be discussed as a single entity.
- That houses always out-perform apartments.
- That capital cities have higher price growth than regional areas.
- That you have to be close to the CBDs to get the best capital growth.
- That the expensive so-called prime suburbs have the best growth.
- That most investors are rich greedy bastards ripping off the system and typically own 15 or 20 properties.
- That no one can afford to buy anymore.
- That the property boom was caused by low interest rates.
- That the population trend towards the regions was caused by Covid lockdowns.
- That rising interest rates means prices fall.
- That rising interest rates caused the downturn in 2022 in markets like Sydney and Brisbane.
- That prices have been crashing everywhere in the past 12 months.
- That the Exodus to Affordable Lifestyle is over because Covid had been dealt with and everyone is moving back to the big cities.
Each and every one of those statements is rubbish.
They’re all misinformation – but, based on my communications with Australian consumers day after day – most people believe at least some of these lies to be truths.
Some people believe all of them.
If you’re reading an article and listening to a commentator in media who is perpetrating any of those furphies, it’s a clear sign that you have tuned into a charlatan – a purveyor of misinformation.
Here’s the key message. If you want to be successful with real estate, you have to do some genuine research.
You have to gather real information. You have to be prepared to invest some time and some money in good information and good advice from the right people.
Reading newspapers is NOT research. Absorbing media sound bites is NOT research.
Indeed, it’s the polar opposite of research.
You have to tune out all that media white noise and invest in proper research and worthwhile advice – otherwise you’re destined to get ordinary results from property investment – or worse, to fail dismally.
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