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The Enormous Divide Between the Headline and the Truth

The Enormous Divide Between the Headline and the Truth | Simplifying The Market

“I have observed that not the man who hopes when others despair, but the man who despairs when others hope, is admired by a large class of persons as a sage.” – John Stuart Mill (1840s)

Even back in the mid-1800s, people knew that negative news sells. That is still true today. All forms of media realize that they will get more eyeballs, clicks, likes, and engagement by posting something negative. However, they must realize that negative headlines impact markets.

Just last week, the National Association of Home Builders released a survey revealing:

“Negative media reports making buyers cautious was a significant problem for 48% of builders in 2018, but 62% expect it to be a problem in 2019.”

Even today, good news is headlined with a negative spin in order to get attention. Here are two recent examples from mainstream media:

Actual Headline #1: Cash-out refis are back – will homes become ATMs again?

The real story: The headline is accurate – to a point. It is true that the percentage of refinances in which the homeowner received cash at the closing has increased to levels that existed in 2006. However, the actual amount of equity homeowners “cashed-out” compared to a decade ago isn’t close.

The dollar amount cashed-out last year was $63 billion. That seems like a really large number until we compare it to 2006, when homeowners cashed-out $321 billion. That is more than five times the current amount.

In 2006, people did use their homes as ATMs. They purchased new cars, boats, and lavish vacations. Today, the cashed-out equity is being used to consolidate debt, as seed capital for a new business, or to help a child with their college tuition.

Actual Headline: Consumer Debt hits $4 Trillion. Americans are diving deeper and deeper into debt.

The real story: The first sentence of the headline is accurate. The second sentence couldn’t be further from the truth. Total consumer debt is the highest it has ever been. That’s because the population continues to grow, and so does the economy (prices and wages).

The important number is how that total debt ranks as a percentage of disposable personal income. That percentage is the lowest ever recorded!! People are not “diving deeper and deeper into debt”. The exact opposite is true. They have less debt now than ever before.

Bottom Line

If you are thinking about buying or selling a home, it is important that you have a true professional handling your real estate needs. Someone who knows the truth about the current economy and its potential impact on the housing market.


Source: KMC

Posted in: Buying Myths, First Time Home Buyers, For Agents, For Buyers, For Sellers, Housing Market Updates, Move-Up Buyers, Selling Myths Tagged: Real Estate

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Margo Borkin Real Estate

9 hours ago

Margo Borkin Real Estate

You’d think with more time at home I’d be motivated to stay on top of housework. If only it were that easy, huh? ⁣
⁣
The good news is there’s no need for any of us to be in a constant cleaning frenzy. Here's what Good Housekeeping recommends be done weekly:⁣
⁣
• Change sheets⁣
• Dust surfaces and furniture⁣
• Vacuum and mop floors⁣
ª Wash towels⁣
ª Clean bathrooms⁣
• Toss expired food⁣
⁣
Owning a home is a lot of work but totally worth it! If you’re looking to buy and need a realtor you can trust like a friend, send me a message. I’d love to connect.
... See MoreSee Less

You’d think with more time at home I’d be motivated to stay on top of housework. If only it were that easy, huh? ⁣
⁣
The good news is there’s no need for any of us to be in a constant cleaning frenzy. Heres what Good Housekeeping recommends be done weekly:⁣
⁣
• Change sheets⁣
• Dust surfaces and furniture⁣
• Vacuum and mop floors⁣
ª Wash towels⁣
ª Clean bathrooms⁣
• Toss expired food⁣
⁣
Owning a home is a lot of work but totally worth it! If you’re looking to buy and need a realtor you can trust like a friend, send me a message. I’d love to connect.
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Margo Borkin Real Estate

1 week ago

Margo Borkin Real Estate

Just sold in #Greenpointe #westbloomfield

Looking to make a move in 2021? You know what to do #movewithmargo
... See MoreSee Less

Just sold in #Greenpointe #WestBloomfield 

Looking to make a move in 2021? You know what to do #movewithmargo
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Margo Borkin Real Estate

2 weeks ago

Margo Borkin Real Estate

HAPPY NEW YEAR!
I know you’re anxious to give 2020 one final heave-ho way back into last year. (Seriously, me too.) But before zooming into 2021, let’s not miss the chance to reflect on the extraordinary year we’ve just lived through. Pretty sure we’ll never see another one like it!⁣
⁣
(This is where we pause and reflect). ⁣
⁣
Now that that's done, it’s time to stare down 2021 and get serious about making it the BEST year ever! What’s on your mind as you think about the year ahead? ⁣
⁣
• A goal to set or settle?⁣
• A habit to nix or nurture?⁣
• A hobby to ignore or explore?⁣
• A relationship to mend or end?⁣
• A skill to meet or master?⁣
• A house BUY or SELL? (I can help with that!)⁣
⁣
Whatever you aspire to this year, go for it! There’s no time like NOW to take hold of your dreams.
... See MoreSee Less

HAPPY NEW YEAR!
I know you’re anxious to give 2020 one final heave-ho way back into last year. (Seriously, me too.) But before zooming into 2021, let’s not miss the chance to reflect on the extraordinary year we’ve just lived through. Pretty sure we’ll never see another one like it!⁣
⁣
(This is where we pause and reflect). ⁣
⁣
Now that thats done, it’s time to stare down 2021 and get serious about making it the BEST year ever! What’s on your mind as you think about the year ahead? ⁣
⁣
• A goal to set or settle?⁣
• A habit to nix or nurture?⁣
• A hobby to ignore or explore?⁣
• A relationship to mend or end?⁣
• A skill to meet or master?⁣
• A house BUY or SELL? (I can help with that!)⁣
⁣
Whatever you aspire to this year, go for it! There’s no time like NOW to take hold of your dreams.
View on Facebook
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Share on FacebookShare on TwitterShare on Linked InShare by Email

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  • Likes: 2
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