Listening to the News – Local in Florida or National on CNN, Headline News or MSNBC – you learn that there is a big chasm in the interpretation of “The Market” and what that actually refers to.

To some, “The Market” is a MacroEconomic entity that encompasses all the good and especially the bad from “Sea to Shining Sea”.  It also includes the downturn of housing prices in Florida, the Subprime Mortgage Meltdown, and all things in between. 

Unfortunately, “The Market” should be viewed through a MicroEconomic looking glass if you are really strategizing and analyzing properly.

So when I hear someone say, “Well, due to this market…” I wonder what they’re referring to?  Could it be:

• The Price of Gas?… so Oil is a commodity at its historic height.    But while they’re complaining about Oil, there is someone making a killing on Gold. 

  While one commodity’s high is bad, the other is good… unless you’re buying jewelry!

• The Price of Real Estate?… again… a commodity!  Well… where are they talking about?  A Condo-Hotel in Daytona Beach Florida – a market where Condotels really haven’t taken off yet?  or an Affordable Pre-Construction Condo in Sebring Florida where prices are still stable.

  An unstable investment grade property in a market that had a big upswing versus a very stable property in a market that had no boom and therefore no bust…

Comparing Daytona Beach Florida versus Sebring Florida is apples to oranges but too many people have been slinging mud about “The Market” without realizing how sweepingly generalities as such just prove their own susceptibility to myopia.

Big words…eh?

What I mean is… people can blame a foreclosure on their block to a drop in their home’s value but the price of a ranch outside Omaha has no bearing on their value.  Unfortunately, sweeping generalizations such as “The Market” bring those two properties side by side for comparison.

People can’t blame the Condo Market in Miami Florida for the softening of Foreign Investors in Orlando Florida… two markets, two different stories.

Macroeconomics versus Microeconomics…

The Macro view is generalization.  It doesn’t allow for microtrends to affect the whole because they’re too small to matter.

The Micro view is analytical and precise.  Demographics, Geographics and Psychographics at a street-level view of Sebring Florida show how it is a stronger market than average in the US, the State of Florida and even in its Central Florida regional classification.

So when you hear someone say, “The Market”… figure out which one they are talking about.  The national Morning News generality or the local real estate professional’s local perspective.

Maybe you can tell me now which one is “in the know”.

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David A. Podgursky, MBA
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