« | Home | »

“Baltimore Home Sales Fall 30%!!! – Hey! Just Wait a Darn Minute…”

By Sherman Ragland | March 10, 2008

The Headline In the local Baltimore Business Paper Says it all:

“Home sales in region fell more than 30 percent in February”

or does it??

Once again, the mass media is scarying the “masses” by printing inflamatory headines up top… but leaving the facts in teeny tiny print at the bottom, or buried in the middle of the story.

The headline would lead you to believe that home VALUES had fallen by a huge amount (30%), but the reaility is that the number of HOME UNITS slid by 30%, while deep into the story, the real story is told, which is that the median price for a home in the City of Baltimore, MD slid a “WHOPPING” 2.5%, yes, that would be 2.5, as in two point five (AND NOT 25) percent.

Granted it is news that the number of units was off by 30% versus a year ago, but when you cut off the supply of money available, you have to believe that the number of units is going to slow down.

But the fact that the actual pricing was off by only 2.5% is an INCREDIBLE piece of (GOOD) information.  It also points out what many of us have been saying for years:  “residential real estate is still very much a local business”.  While the amount and flow of mortgage money is global, the ’so-called’ housing melt-down is really based on where the house is located.

In markets like Florida (particularly Miami-Dade County) where there was a tremendous amount of over building over the past several years, housing prices are in fact falling like a stone.  But in markets where the supply did not get way ahead of demand, like the suburbs of Washington, DC (yes, Baltimore is now officially a suburb of Washington, DC), housing price declines have been “modest” to non-existant.  In fact, inside the Capitol Beltway, housing prices actually increased by 10% in the latest set of data made available by the same folks who provided the stats for the above story in today’s Baltimore Business Journal.

So what’s the point??

#1 – As an investor you can not allow yourself to be swayed by the local media.  Know your facts, and read beyond the headlines;

#2 – Understand that real estate is LOCAL!

#3 – Understand that the folks sitting across the table from you may be getting their information from the local paper, and maybe ONLY from the local paper.  Therefore, be prepared to act on the information that others may read when it works in your favor.

Remember that there are three types of people in the world:

A) Those who make things happen;

B) Those who watch things happen;

C) Those who sit around and say: “hey what just happened??”

People who know their market and use the knowledge to make money are in category A, while those who read the paper and wonder, “what did these guys know to buy when every one else is scared and sitting on the sidelines” are in category B and C.

Popularity: 5% [?]

Topics: Uncategorized | No Comments »

Tags: No Tags

Comments

You must be logged in to post a comment.