I wanted to let you know that our local newspaper, The Temecula Bugle, will run a blurb about this blog in it's October edition. I'm hoping it will attract investors from this area who are willing to share about their experiences. The publisher said that she would put something about the blog in The Murrieta Bugle in November or December, if there is enough room. I don't think you can access the article on the web site (http://www.thebugle.com/), so, if it does get published, I will transcribe it in a post.
The media is a great way to get the word out about certain issues. It's a double-edged sword, however, because, as we have seen happen over and over again, they are capable of finding out about things one would rather they not disseminate, too. That leads me to the question of the day (no, I won't have a question everyday, but I thought it sounded good).
How much influence did the media have in the genesis of the current real estate market? Now you shouldn't answer hastily. Think about it. I can see this going either way. If you recall, it seemed that in the height of the market, the media was running around like the proverbial Chicken Little, "The market is falling! The market is falling!" And real estate prices just kept rising. So media outlets repeated, as necessary, until they achieved their desired results. Or . . . .
The other side is that the market would have fallen regardless of what the media reported. It was just time for the bubble to burst and the corrections to start. The media is merely reporting on current events.
This is really a tough one. If you think about it long enough, you can get dizzy in the circle it takes you. If pushed, I would venture to say that the media has a strong impact on the country (quite possibly around the world, but I haven't been around the world). I think the constant barrage of stories about the dreaded "bubble" finally hit it's mark. Yes, it's true that prices couldn't keep up with the rate that RE had been appreciating. Did all the buyers, who had never met, decide unanimously to boycott sellers until they developed more reasonable expectations about the value of their properties? If that were true, how would they have all received the same message at approximately the same time? Could it be through the media?
It only takes a small number of shoppers to start the cataclysmic plunge to oblivion. Because, once the market displays an inkling of slowing, the media announces that, contrary to popular belief, the sky has now fallen. Repeat as necessary until you have created such a disaster that now it's actually newsworthy. Consumers start to think, "Well, I don't want to buy during a real estate slow down," which perpetuates even more sluggishness. With this correction, we have the twist about the sub-prime lending market. That is a huge story. The ramifications are far and wide as companies start shutting down and there are less opportunities to buy for those with lower credit ratings. And things head for a stand still. Are we at the lowest point yet or do we have more to go?
I haven't seen prices drop considerably yet. Yes, there are plenty of values right now, but I see stable homeowners willing to wait it out before lowering their asking price. I was driving through the back country out here this morning (also known as French Valley or Winchester) and truly was amazed at the number of developments being graded as I write. Tons and tons. Only one community (which stood alone in Menifee off Scott Road east of the 215) said "Lower Pricing." One. Out of dozens. Have the others quietly reduced their prices? I don't know. I don't like to shop unless I am in a position to buy something--I really don't want to waste the builders' agents' time. If any of you out there know, please contribute.
Therefore, according to media (of course!) reports, experts anticipate prices to drop further by the end of the year and the first quarter of 2008. Will they continue to fall because we have been told they will, or would they anyway? I'd like to know what you think.