A national real estate article published in a community newspaper in Elizabethtown, Ky., caught the eye and ire of several local real estate professionals, and brought home an age-old conflict between news coverage and industry interests.
The headline of the article, authored by Claes Bell, questioned, "Is this a good time to buy a home?"
Focusing on first-time home buyers, the article suggested that heightening restrictions in lending requirements, including high down payments and the risk of further foreclosures and price decreases, may not be the best fit for those seeking to become homeowners.
Local Realtors gave editors at The News-Enterprise an earful about the inclusion of that article in the newspaper’s weekly real estate section.
They echoed a rallying cry that has been sounded by real estate professionals in other markets, too: that local real estate markets are unique, and reports of national market trends tend to overlook the fact that some markets are performing better than others.
At the core of the conflict is public perception of market conditions, and some real estate professionals are blaming the media for scaring away potential buyers and sellers from the market with stories that they say don’t reflect local market conditions.
Industry professionals have also charged that bad news sells, and that news organizations are carrying stories that tend to exaggerate the market downturn.
Strategy to counter media coverage
Trade groups like the National Association of Realtors have fed into the fervor over perceived negative media coverage. A multimillion-dollar ad campaign by the Realtor group this year, for example, seeks to counter "some of the recent negative national media reports related to the housing market," according to a Web site description.
And Vicki Cox Golder, a Realtor who is serving as first vice president for NAR, detailed a strategy by the trade group that is intended to "generate positive media coverage about real estate opportunities in local markets." She said in her presentation, "I think that you will agree with me that one of the biggest issues that we face today is the media and how they report what’s going on in the market."
The so-called "surround sound" strategy "is aimed at … ‘on-the-fence’ home buyers who may be hesitant to jump in because of the negative things they are hearing and reading about today’s housing market," and the strategy includes "an extensive toolkit and assistance from professional public relations firms."
News organizations are tasked with providing accurate information for their readers, whether their focus is on national or local news. In some cases, the truth can be hurtful to industry interests.
And newspaper executives who spoke with Inman News said it can be a difficult balancing act to satisfy advertisers and readers alike.
Scathing letter in Elizabethtown, Ky.
Wolfgang "Wolf" Parker, who is co-leader for an agent team at RE/MAX Executive Group in Elizabethtown, sent a letter to the publisher of The News-Enterprise to protest its publication of the national article that questioned whether it was a good time for first-time buyers to hop into the market.
"How irresponsible of you as the publisher to let that article run. That article has done additional damage to this housing market and to hundreds of local Realtors who advertise in your paper," he charged in the letter.
"Where would The News-Enterprise be if the Realtors did not advertise in your paper? I spend over $2,000 a month with you and am constantly being solicited to increase or add new advertisements. Perhaps I’ll just spend my money on the Internet. I am furious and feel cheated. Nothing you say can fix what you have done," the letter states.
Parker told Inman News that while markets like Detroit or Cleveland may be suffering, Elizabethtown isn’t faring so poorly — and he doesn’t want local buyers to get the wrong message from nationally focused news.
"It’s a great time for buyers and there’s just a slough of homes on the market. Why wouldn’t you want to buy (here)?" he said. "The market has slowed down from where it’s been in the past, but there is solid movement here." There is a large influx of military personnel coming to the area, he said, which has given some lift to the local market.
The media, he said, have "been getting hammered and rightfully so," for their national real estate coverage. "You guys make big money on bad news."
Consumers, he said, are definitely influenced by news about the national housing market, even if it does not hold true for local market conditions. "When (the media) beats a drum long enough, people are finally going to listen. You are going to hold on to your money."
He added, "I have a lot of people coming in here, saying they want to wait: ‘I’ve heard that right now is not a good time to buy.’ "
He said that others within the local Realtor group also had reacted negatively to the article that appeared in the local paper, and he did receive an apology from the newspaper.
Newspaper reaches out to industry critics
Ordway said he heard criticisms — either directly or indirectly — from about six Realtors in the Elizabethtown area about the article.
He viewed the input as constructive, and the newspaper has reached out to local Realtors and builders and offered the opportunity to contribute guest columns to the newspaper on a regular basis.
"As a small community newspaper in a market like ours, we’re pretty responsive to requests from our customers. The challenge for our newspaper, as with any newspaper, is … the precarious balance of being able to report accurately and intelligently whether locally or nationally," he said, while at the same time understanding the concerns of its advertisers.
"We look at the complaint in terms of how can we make an improvement to serve both reader and advertiser equally well moving into the future," Ordway said.
In addition to offering guest columns to industry participants, the newspaper agreed with a request by the Heart of Kentucky Association of Realtors local trade group to reprint a Wall Street Journal article titled, "A Good Time to Buy a House," by Shelly Banjo.
"We have a longstanding working relationship with the Realtor association. Clearly we want to be responsive … while also maintaining the integrity of our news report," Ordway said.
The Realtor association actually negotiates an advertising contract with the newspaper on behalf of its members, and individual members decide what to contribute for their share of advertising.
Terry Shortt, who owns a real estate school and training company based in Key West and is familiar with the Elizabethtown incident, said that in some small market areas such as Elizabethtown, local newspapers remain a major advertising vehicle for the real estate industry.
When the market slows down, real estate professionals may pay more attention to where their ad dollars are going, he said, and there is the potential for more frustration with news coverage.
"They feel like the buyers are being scared off by the very people they’re buying ad space from," he said. "They’re just frustrated. I didn’t hear any complaints, any grumbling, a couple of years ago."
Realtors seek improved coverage in Bend, Ore.
On the other side of the country, a Realtor group in Oregon has worked to educate the media about the state of the local real estate market and has at times been at odds with local media coverage.
Bill Robie, government affairs director for the Central Oregon Association of Realtors, said that even while the market was booming in the Bend, Ore., area, "there were concerns — actually, significant concerns — with how the housing market was portrayed in the local paper," the Bend Bulletin.
There seemed to be a "hint of gloom-and-doom forecast in there," he said, "even when things were going very good. Certainly members didn’t feel it was a very accurate portrayal of what was going on."
And when the housing market shifted, "We started to do more outreach to the media."
The Bend Bulletin’s coverage of the downturn has been "fairly accurate," he said, though the Realtor group, which has about 1,900 members, became concerned that "national coverage was dominating local conditions and that people weren’t getting a healthy perspective on the local market."
He added, "Because of the overwhelmingly negative stories that paint the whole housing market with a broad brush, we had a media summit here about a month ago."
Reporters from local news outlets were invited to attend, he said, and an informal question-and-answer session was held to discuss local market conditions and expectations for market performance.
The intent, Robie said, was to "make sure that our side of the story was getting heard … to make sure we are getting a fair shake from the media." The media summit was held in late February, he said.
Newspaper reporter fired
The recent firing of David Fisher, a business reporter at the Bend Bulletin, a local newspaper, drew the attention of an alternative weekly news publication, which questioned whether the matter had anything to do with the newspaper’s market coverage and real estate industry interests.
The Bend Bulletin’s editor-in-chief, John Costa, defended the newspaper’s editorial product and said that the termination of the reporter had nothing to do with his coverage of the real estate industry.
He said he could not discuss specifics about the reason for his termination, though there was a "violation of a principle that any institution in the industry would observe."
The Source Weekly, the Bend-based alternative publication, published a report on March 10 stating that Fisher sent an e-mail message to the Bend Bulletin’s human resources director alleging that a real estate article he wrote was edited to remove comments that were "skeptical of an imminent turnaround in the floundering real estate market."
That article, which was about a real estate forecast presented by an area appraiser, was edited "to remove any facts or opinions that tended to disagree with (the appraiser’s) rosy predictions," according to the e-mail message.
The e-mail also alleged, according to the report at The Source Weekly, that there was a "pattern of editing that included misleading headlines, sources being banned from my coverage, story ideas getting spiked, and odd pre-story cajoling, all of which seemed designed by the executive editor … to generate more favorable coverage of the local real estate market than I would have thought was best in the two years I have been assigned to cover it for the paper."
The Source Weekly also stated that the local real estate and building industry had embarked on a "Best Buyer’s Market in 20 Years" campaign that sought to attract buyers and favorable media coverage of local market conditions.
Editor: Newspaper does not pander to industry
Costa said that anyone who reads the real estate coverage of the Bend Bulletin would be hard-pressed "to make a case that this newspaper is in any way pandering to the real estate industry."
"Last fall we had letters to the editor saying the belief of the industry in this town is (that coverage) is far too negative on them, not positive about them. But we have covered it accurately," he said.
Costa said he had even written a column in support of Fisher’s coverage, and that the newspaper has no interest in "cooking coverage" to benefit the industry. The industry definitely has its spin on market conditions, he said, and "we don’t cover the advertising campaigns."
Also, Costa said he has not handled a single request from a real estate professional or builder to can a story or produce a news story.
Some industry participants have suggested that the newspaper has the ability to exacerbate the housing downturn by focusing coverage on it, though he said it’s "absurd" to suggest the newspaper has that kind of power. In response, he said, "At least give us credit for creating the (boom) market — we never got that."
Fisher could not be reached for comment.
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