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There is no question that we are living in tough times with some huge challenges. Yet, the level and volume of doom-'n-gloom is quite alarming considering how most of us are actually relatively just fine...in the big picture.
Want to see real suffering? Take a glimpse at the lives of those living in war-torn areas like Ukraine and Sudan. For many, many months we have been told of an impending global economic collapse: The reality? Neither China, the US, the EU, India, Japan, the UK nor South Korea - accounting for almost 70% of the global economy - are in recession while most predictions many months ago said this would be the case with the US Federal Reserve's hyper-aggressive interest rate hikes (five percentage points. in about a year!)
Now we are being told of the biggest commercial real estate disaster happening. Yes, there are some really big valuation challenges amongst many office buildings (not all) and there will be pain. But how often do the headlines broadcast that 84% of all commercial real estate is NOT office buildings? I have yet to see that headline...
While some housing markets are seeing downward pressure on pricing - most after extreme, rapid, and recent 2020-2022 escalations - the reality is the 'bloodbath' as many predicted has not materialized. Maybe housing markets are smarter and see a market grossly under-supplied that 3, 5, 10 years from now may look back at these prices and say this was the 'opportunity market of 2023'? Have you seen any headline saying, "Home prices drop 7% after rising 25% over the past 3 years"? I have not.
Gloom and Doom sells. It engages. It can also artificially influence markets that leave just a few beneficiaries. If you had billions of dollars on standby to buy distressed real estate, would YOU be on television speaking to the long-term strength of real estate?
Beware of headlines, especially those that spew averages that are mostly useless. Alert your clients and sphere to the deception of headlines. They may not be untrue, but they usually veil the complete picture or ignore the details. They do not give a balance of perspective. They are designed NOT to calm you. They are designed to enrage, invoke fear.....and fuel attention and engagement. And they are succeeding. But only if we continue to let them do so. |
