It's certainly a good thing that there is so much negative news to report on these days otherwise the media might have a tough time scrambling for some stories.
Macleans's magazine has done it again with their March 2nd edition due to hit newstands this week with a cover story labelled as a "Special Report" on house prices. They're taking the age-old good news/bad news position stating that "Canadian real estate will soon be much more affordable" and "The value of your home is about to drop another 20%." Further, they go one step further by claiming that what they are reporting in is "The shocking truth about the value of your home."
Much of their story revolves around the trials and tribulations of a 42 year old computer analyst who purchased a $1.5 million penthouse condo in Vancouver. Sounds like your typcial Canadian homeowner to me.....not! Anyway the poor chap can't fulfill his purchase obligation on the penthouse as according to the story, he has been unable to sell his current condo and his bank "wouldn't even consider" giving him a $1.5 million mortgage for his new place. Gee I wonder why?
Further, the article critcizes the real estate profession stating that the MLS® information we provide is biased and that the Canadian Real Estate Association (CREA) who owns the rights to MLS® would not respond to a request for an interview. First of all MLS® information is what it is. A home is listed for a price and sold for a price both of which get reported for what they are. It's pretty hard to be biased when you are obligated to report the facts. Secondly, CREA was never contacted by Macleans and they will formally issue a repsonse to the article next week. Macleans is quick to point out however, numerous comments made by CREA's equivalent in the U.S., the National Association of Realtors (NAR) yet isn't Macleans slogan: "Canada's news magazine?"
As I stated in a prior posting (Don't Believe Everything You Read) the meltdown in the U.S. real estate market is anything but reflective on what conditions are in Canada. Has the Canadian real estate market slowed? Yes. Was it due for a correction? Yes and rightly so in over-heated markets like Vancouver and Calgary. Have prices dropped? Well the guy with the unsaleable condo in Vancouver has dropped his but it also hasn't sold yet. Maybe he dropped it from a list price it should have never been at to start with. Reading the article it sounds as though it was priced where he needed it to be in order to afford the $1.5 million penthouse. What someone needs financially out of their current property in order to move-up has absolutely no bearing on market value.
Most people I have been dealing with echo my sentiments about the media these days. They propogate negative, sensationalistic stories trying to lure in readers. Perhaps this is done in a desperate attempt to stem the loss of advertisers which are fleeing print media in droves or maybe they all have shares in pharmaceutical companies selling anti-depressants? Maclean's has once again sunk into the muck and mire of tabloid jounalism, what's next a cover story about "alien octuplets?" Be sure to look for a copy next to the Star and the Enquirer at the grocery checkout.
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