Should You Believe Everything You See In The Media?
A recent current affairs TV story caused outrage in the property community with their sensationalist reporting of a looming property market collapse. Chris Gray questions whether you should believe everything you see in the media.
A recent current affairs TV story caused outrage in the property community with their sensationalist reporting of a looming property market collapse. They had advertised the show heavily, and people were talking about it before and afterward. Many viewers were left thinking that the world could be coming to an end. So, should we believe everything we read and see in the media or is it all hype?
The media is a business, and they need to sell too.
It’s a changing market, and it’s even harder for newspapers and TV stations to draw the crowds when so many people are on their mobile devices. If they advertise a show saying that everything is all fine and you don’t need to worry, how many people will tune in? Probably not many. Bad news sells the best, and that’s what we often see on 95% of the news shows, unfortunately.
How much of the conversation have you heard?
Unless you’ve watched the TV show live, chances are, the media has highly edited the final version, to ensure that you only hear what they want you to. They need to do this though as it wouldn’t be very exciting to listen to 3 or 4 economists all drone on for an hour each. They do need to pick out the best bits, but the danger is that you’re getting the producers or journalists view on the situation. In the example above, one economist had a 45-minute interview but only one minute made it to air. Which bit do you think they chose?
What is the journalist’s knowledge level of the subject?
Producers and journalists can’t be specialists in every single subject, and so it can be genuinely hard for them to know which parts of various expert’s commentary they need to show and what to leave on the editing room floor. Their skills are often in creating the most interesting or controversial story.
There’s more than one property market.
Even if it is true that a property could drop by 40% over the next year or two, does it mean that every property will? I don’t think so. It will all depend on:
- When you bought it
- The price you paid
- The price level you’re at in the market
- The local demand
- The local supply
- Whether you have to sell
- What agent you chose
- What marketing campaign you do etc.
Some properties in Australia are continuing to rise while others could well drop by 40%. The ones that fall are more likely to be the ones that are in massive supply and in limited demand -i.e. no one wants them.
The best book doesn’t sell the most.
The most well-marketed book does. The same goes for media – it’s all about how well they sell it.
Who are the experts and what vested interest do they have in saying a particular thing?
If you ask a company that sells shares what they think of the property market, they’re going to bag it 99% of the time because they want you to buy shares. You need to have a look at the expert, see what interest they may have in talking the market one way or another and then decide how much credibility to give their comments.
Is it a one-sided or two-sided discussion?
In a perfect world, you should hear from a number of experts that have opposite points of view to then give you a balanced opinion. Sometimes, however, only one side of the story is presented in a bid to create sensation and shock. Other times, they give airtime to experts that are always outrageous even if they’ve never been right because at least it’s then supposedly balanced.
I’ve been presenting and writing in the property media for 10 years and so based on the above you need to take what I say with a pinch of salt as well! I’m a personal property investor and have a property buyers agency business, so I am certainly biased too.
Many years ago, on my Sky News show, I brought on a government property expert called Dr. Mort Gage. He was, in fact, a corporate hoaxer, and for 30 minutes he talked about the plans for change in the property market; how the NSW government was going to build a tunnel from Vaucluse to Manly so that the rich eastern suburbs people could get to their holiday homes in Palm Beach a lot quicker. At the end of the show, we revealed who he really was and that the show had been fictitious. The point is – just because you see someone in the media, doesn’t mean what they say is all true. I think I had my most complaints that night, but I still believe it’s a valuable lesson, and those viewers who complained didn’t get the point.
I always tend to try to see the positive in everything. If these TV shows do turn people off the market in the short term, maybe that gives me more opportunity to buy myself, and get a better property at a better price. Then when the market recovers I get every day of the growth while it takes the rest of the herd another 6-12 months to react.