An Air of Desperation in This Realtor Ad

Huge props to my sharp-eyed husband for spotting this one.  He was watching T.V. the other night when this National Association of Realtors T.V. ad came on.  We always pay attention to those ads, because we marvel at how the N.A.R. manages to put its “it’s always a good time to buy” spin on everything, no matter what’s going on in the real world.  For example, one commercial puts lipstick on the unprecedented inventory of unsold homes by asserting that “buying opportunities have never been better.”

Anyway, this ad — part of the N.A.R.’s “public awareness campaign” — focuses on what a smart investment homes are. Here’s a portion of the voiceover:

“If you’ve purchased one of the millions of homes that will be sold this year, the National Association of Realtors wants you to know that you’re making a good decision — for your family and for preserving long-term wealth.  In fact, 60% of the average homeowner’s wealth is from their home’s equity.”

The first time I saw that commercial, I wondered where that home-equity statistic came from.  People who are losing their homes or owe more than their homes are worth don’t have any home equity.  Many buyers this decade treated their homes like ATM machines, spending their gains faster than you could say “Home Equity Line of Credit.” And just a few weeks ago, the Fed announced that Americans’ home equity was at an all-time low.

Anyway, my husband noticed that the commercial included the source of that home-equity statistic, in tiny print at the bottom of the screen.  Here’s what it says:

“Homeownership and Its Benefits,” Urban Policy Brief #2, 1995.

That’s right:  The National Association of Realtors is basing its message about wealth-building via real estate on a 13-year-old report. 

Times are lean for Realtors right now, and I’m sure it’s alarming to the N.A.R.  But trying to get people to buy homes by putting a 13-year-old statistic out there is misleading and disingenuous.

If the N.A.R. wants to gain credibility, it needs to stop feeding us self-serving messages under the guise of a “public awareness campaign.” The truth is, it is not always a good time to buy. The mantra it has relentlessly pounded into us for years — that we should all have the goal of buying a home — has been effective.  But homebuying at any cost has been the source of ruin for many families this decade.

Realtors are salespeople whose goal is to sell as many homes as possible. In that regard, these ads may be doing their job.  But the public would be better served with a true public-awareness campaign — for instance, “Responsible Home-Buying 101.”

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