Why do property doomsayers get so much attention when they’re consistently wrong? Their dire warnings make for interesting headlines and web forum discussions, but the hysterical diatribe that spews forth is almost always baseless.
The property industry has always had to endure a stream of commentary from pessimists. For as long as there has been a captive audience, these negative nellies have brandied about warnings of massive price slumps, devastating market crashes and enduring financial despair.
As history shows, they’re always wrong.
The advent of the internet brought about the emergence of a new breed of keyboard warriors who fancy themselves amateur real estate analysts or market watchers. They plague forums, news sites and blogs, offering their impassioned predictions about the prospects for property.
It’s a bit like spotting gathering storm clouds on the horizon and loudly screeching with complete certainty about an imminent hurricane that’ll destroy everything in its path. When, inevitably, a light rain shower comes and goes, they stand proudly – chuffed by the fact that it rained and therefore they were sort of right.
For years, they’ve taken it upon themselves to warn Australia about 60 per cent house price plummets and mass mortgage defaults, among other things. Just like their old-world counterparts, they’ve always been wrong. What they lack in accuracy and knowledge they make up for in conspiracy-laden oddness.
I was covering property for a media outlet in Brisbane during the height of the GFC. It was a turbulent time and I wrote about everything from the optimism of the property industry to the shelving of several major residential developments. A group of local ‘real estate market crash-watchers’ took note of my reports.
I was pretty balanced, I thought. They saw it differently. In their view, I was part of a widespread conspiracy hatched by the real estate industry and governments to inflate prices, hide the truth and cushion the blow from a long-overdue bursting bubble.
My surname was similar to a well-known industry representative’s, so they mused that I must be a sympathetic relative peddling his message. It didn’t matter the spelling of our respective names was totally different. They also ‘discovered’ I’d gone to university with the son of an analyst who was mostly dismissive of the negative outlook. If I did, I didn’t know it.
There were numerous other allegations – most of them fairly insane or just generally offensive. It wasn’t only me who copped it; almost anyone who wrote about property or the economy was in the firing line.
Not all online commentators are as enthusiastic in their views, but all of them are pretty unconvincing. They lack data, knowledge or some other form of evidence to back up their claims. Their timing is usually pretty curious too. Ironically, just as all the reliable signs point to a market recovery here, some of the usual suspects are beginning to crop up again.
I read with interest (and a bit of admiration) property and financial expert Margaret Lomas’ breathtaking smackdown of American doomsayer Jordan Wirsz. A sort of poster child for ill-informed forecasts based on a combination of Google and self-importance, Wirsz has essentially said Australia’s “housing bubble” is about to burst.
Yes. The housing bubble – you know, the one that’s become so very huge and strained after years of lackluster activity in almost every market in the country.
And as property analyst Terry Ryder pointed out this week, most of the vocal critics who rave about an imminent bubble burst can’t actually describe what such an event is. They can barely define the bubble itself!
I’d prefer to listen to economic and financial experts and analysts. Most of them agree things look to be heading up again. None of them, to my knowledge, share in wild theories about a secret global fraud involving all levels of government, thousands of sneaky real estate agents and some sort of mythical unicorn god.
I’m not saying all property doubters are mouth-frothing crazies. I am however fairly confident most of them are wrong – again.
Shannon Molloy is the deputy editor of Australian Property Investor magazine www.apimagazine.com.au