New Realtor Ads Come Across as Less-than-Genuine

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Have you seen these recent Realtor ads running on TV? If you’ve watched any of the NCAA men’s college basketball tournament you’d be hard-pressed to miss them. The gist of the commercial is: there is a great opportunity to buy a home, mortgage rates are low, there are plenty of homes to choose from, and you can get a great deal on your dream home. Contact a Realtor today and buy the home you’ve been waiting to buy.

To me this just seems like a desperate attempt by the National Association of Realtors (NAR) to justify their existence to their members. It’s like they’re saying "We’re trying" without trying to sound exasperated or panicked. It makes sense from the NAR standpoint. The exclusivity of the MLS is under constant barrage, homes aren’t selling, Realtors are having to cut commissions and are cannibalizing one another because there are too many Realtors, and home prices are falling, making those cut commissions even smaller. They had to do something.

For consumers this just seems like a raw deal. It’s not the perfect time to buy a home, home prices are tumbling in almost all parts of the country. Interest rates may be low, but the recent turmoil in the markets has made it hard to borrow money for a home without having substantial cash to bring to the table. Most experts agree that home prices are just starting to slide and no one is even trying to call the "bottom".

Pitching people’s need to walk away from their house because they are upside-down in their mortgage and need to get out as a "great opportunity" for others is at least cold-hearted. Encouraging people to buy at the top of the slide is at least disingenuous, at worst criminal. Their attempt to placate their flustered constituency while desperately trying to increase demand is sad. Worse, it is misleading. Now is not the best time to buy a house. You will most likely overpay for your house and see it depreciate in value (not all markets, but most) in the short-term.

The NAR’s transparent attempt to boost consumer confidence should be frowned upon and its ethics called in to question. These ads do not have the consumer in their best interest, are misleading about the current market and can cause great harm to anyone who follows the advice laid-out in the commercial.