LACKIE: Uncertainty reigns supreme in real estate market today

But it is the consumer driving the bus, not the media and certainly not the realtors

For the love of all things holy, can we please stop disparaging people for being “doom and gloom” about real estate at the moment?

This feels like it should be obvious — and it probably is — but it feels important to point out that dismissing any perspective that runs counter to a sunny narrative as spin by a media machine that runs on negativity and manipulation is objectively absurd at this point.

It was ridiculous back in the summer, it was still ridiculous in the fall, and it’s sublimely ridiculous now that winter has set in, both literally and figuratively.

Especially since the data has subsequently confirmed exactly what the so-called “fear-mongers” were identifying.

I watched as those who called the peak last winter and described a subtle yet marked shift in the marketplace were met with eye rolls and told buyers were simply fatigued.

When the summer was deadsville and articles described the low volume of transactions and declining sale prices, my social media feed was absolutely wall-to-wall with agents insisting that everything was fine and that the data was being cherrypicked; we were just seeing a to-be-expected slowdown reflecting life after lockdown.

What might one make of the fact that we closed out 2022 with fewer transactions in the month of a December than we had in that first month of lockdown in April 2020? Would this reflect a market seized by the doom and gloom headlines or are we actually looking at what happens when unaffordability is no longer conceptual but is, in fact, a cold, hard reality?

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Can we collectively agree this isn’t fake news designed to drive clicks or sell newspapers? Just like it wasn’t fake news and sensationalism last year when the prices were soaring week-over-week, month-over-month.

Did describing the exuberance likely give way to more exuberance? Sure. But did it produce a state of affairs that wouldn’t otherwise have existed? Of course not. This is not the same as the age-old debate of the chicken or the egg. The exuberance came from watching the momentum afforded by emergency stimulus and rock bottom rates. And now, so too, the pessimism.

Though I would also say that the pessimism isn’t universal, even if the sales volumes suggest it may be. To me it seems like uncertainty is the real force to be reckoned with.

The reality is that everyone’s circumstances are different. There are some people who are going to feel comfortable transacting in this marketplace but are finding that there simply is nothing out there to look at.

There are some sellers out there who are struggling with the idea that today’s prices have fallen from the peak and want to hold out in hopes that they rebound.

There are some for whom it makes complete sense to cash out or upsize or purchase investment properties. And there are still others who are taking a watch and wait approach. All of which are reasonable positions.

But it is the consumer driving the bus, not the media and certainly not the realtors.

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If real estate agents were so skilled and cunning as to be able to manipulate buyers and drive markets into a frenzy, wouldn’t we still be doing so now?

Well, some are certainly trying.

“Don’t miss your moment, this will be but a blip in 20 years,” some are posting on their social channels. But to what end? If people literally can no longer qualify for what they want to buy, let alone comfortably carry what they already own, no amount of boosting will rally them back up again.

Pessimistic take? Probably. But it’s the current reality as far as I can tell.

The time of irrational exuberance is now behind us. Will it be back? One can assume.

But it’s a safe bet that with rates as high as they are for as long as they’re likely to stay here, what happens in between will have little to do with external voices planting seeds and absolutely everything to do with the space people are able to carve out between the rock and the hard place.

@brynnlackie