Straight Talk - What The Media Doesn't Want You To Know

Every morning I spend at least a few minutes — and sometimes more than that — scanning selected news and information sites concerning the economy, and the real estate business in particular. I don’t need to tell you that news about our economy isn’t particularly pretty. But I do believe it’s important to recognize that ALL of the information that we read, see, and hear is passing through different filters, and in the process the impact of what we learn can be manipulated. In some cases the real truth can be — and is being — obscured.

Case in point: The daily news concerning besieged mortgage markets.

Julie Straub, Senior Loan Officer for F-M Lending said it well a few weeks ago: “If you listen to the media you would think mortgage money was not available,” Julie wrote me. “I can tell you after almost 23 years in the mortgage industry, that is just not true. We have an amazing number of different loans available with rates at unheard-of lows.”

Mortgages are in the news a lot these days. But here are some facts about the housing and mortgage industry that you might NOT have heard:
● 30% of all real estate in this country is owned free and clear of a mortgage. Putting that in perspective, of the 10 houses that surround you on your block, the homeowners in 3 of them own them outright.
● 93.9% of homes with mortgages are current in their payments. Subtracting those three homes that are paid off, only one homeowner around you has been late or missed a payments to his lender.
● 97.2% of homes with mortgages are NOT in foreclosure. But even that one neighbor isn’t so far behind that he’s in trouble with the bank.
● 40% of foreclosures nationally are non-owner occupied properties (rentals, investments, or second homes). There is a reason that Nevada, California, and Florida are constantly topping the lists of states with the highest foreclosure rates. Those states are meccas for vacation homes or investment and rental property. When the exotic mortgages written to purchase those homes started triggering higher monthly payments within the last two years, the owners quickly went into default on their payments.

The burden for cleaning up the mess falls on all of us, but the media never talks to those four out of ten who walked away from their commitment to their lender just because they decided to give up their vacation home.

Without question, we are under a blizzard of bad news, and I believe we have been for the past two years. Julie Straub has some more encouraging words: “This is probably the best time in most of our lives to purchase a home. Interest rates are at historical low levels. Not since the 1950’s have we seen rates as low as they are today. In addition, we live in an area that is constantly looked at as a place people want to move. North Carolina was the fourth fastest growing state last year. The Triangle is constantly listed on the ‘best of’ lists.”

Also, please remember this: Real Estate is an incredibly local business. The state of things in one part of the country does not translate to ALL parts of the country. What might be true in one area might not be — and probably is not — true in another area. The next time you hear a news report concerning “how bad things are” in the Triangle real estate market, please call me for some perspective… and for the truth.

Robert Flinn, Realtor/Broker
Fonville Morisey Realty, Inc.
919-698-2040 (Direct)
919-402-1242 (Office)