New show provides reality check on real estate
Forget about “Fear Factor.” The scariest reality show on television these days could be on the Home and Garden TV cable channel.
“Real Estate Intervention,” which airs at 10:30 p.m. Thursdays, offers tough love for people in denial, helping home sellers grasp what their place is really worth. Hint: It’s a lot less than they think.
“We wanted to create a show that truly reflects what’s going on in the marketplace right now, a show that presents real-life scenarios that people are experiencing today,” said Freddy James, senior vice president of development and production for HGTV, which is based in Knoxville, Tenn.
That’s why the cable channel known for shows like “Spice Up My Kitchen,” “Design on a Dime” and “Gardening By the Yard” is now launching a series that comes right out and acknowledges that times are tough.
“For years, people have watched HGTV for inspiration and ideas,” James said. “What we’ve found with the turn in the economy is people are still very much interested in their homes, but for a lot of different reasons. There is a lot more anxiety associated with their home.”
Sabrina Soto, a designer and stager who hosts the show, said several couples profiled on “Real Estate Intervention” are facing the prospect of foreclosures or short sales – selling for less than they owe on the mortgage.
“It’s a very difficult program to work on; every week, I meet a couple in such a horrible predicament, really heart-wrenching stories,” she said. “This is the reality of what’s going on in the market. It’s kind of a breath of fresh air. We’re not trying to sugarcoat anything.”
The first episode showcased a couple with a more prosaic relocation need: They had to move from Baltimore for Philadelphia for job reasons.
Real estate expert Mike Aubrey, who describes himself as “soft as an 8-pound sledgehammer,” valiantly tried to demonstrate that the $239,000 they were asking for their row house wasn’t viable. He took them to two comps, or nearby comparable listings: a home that had recently sold for $217,000 and another on the market for $228,000. Although both comps appeared larger and in better shape, the couple staunchly insisted that their own place was much more desirable.
“Why aren’t they getting it?” Aubrey mused to the camera. “They’re upset; they chose not to listen to me.”
The show ended with Soto revisiting the couple two months later. They had finally dropped the price by $20,000, but the market had gotten even worse, so they ended up deciding to rent out their house for a slight monthly loss and try to sell it in the future.
The show shouldn’t have any problem finding homeowners who are living in a state of denial. A series of surveys conducted for home-valuation service Zillow.com found that many Americans believe their property is worth more or the same, despite ample evidence to the contrary. Since last summer, the quarterly survey has found more people accepting the reality that prices have swooned, but there are still plenty who think somehow they are immune to macroeconomic forces.
“People hate to sell for a loss, even a perceived loss,” said Terrance Odean, a behavioral economist and professor of finance at the Haas School of Business at UC Berkeley. “A clear loss is selling for less than you paid, but sometimes people look at what their neighbor’s house is worth and don’t want to get a penny less.”
“We tend to value things more if we own them than if we don’t. Studies show people weigh more heavily the attributes of the thing they have.”
James agreed.
“Homeowners become so emotionally attached to our homes, it’s often hard to step back and look at them the way an outsider would,” James said. “When you’ve invested your own blood, sweat and tears, you’ve got an emotional connection that can unfortunately be blinding in the real estate game.”
(E-mail Carolyn Said at csaid(at)sfchronicle.com.)
(Distributed by Scripps Howard News Service, http://www.scrippsnews.com)
