Housing Prices Up from Year Ago, Yet CBS Highlights Comparison to Great Depression

On a day when the National Association of Realtors (NAR) reported a rise in the price of homes so the average median price is above where it was a year ago, Wednesday's CBS Evening News featured a soundbite claiming “home price depreciation” unprecedented since the Great Depression. Apparently, reality wasn't negative enough for CBS, so they felt a need to add some embellishment.

“The housing market is going deeper in the dumper,” anchor Katie Couric rhymed, as “America's Realtors reported today that used homes were selling in June at the slowest pace in four and a half years.” She acknowledged “a bright note for homeowners,” but added a caveat in relaying that “house prices went up for the first time in nearly a year, but just barely.” The headline for the NAR press release from which CBS cribbed gave equal weight to two developments -- “Prices Rise, Existing-Home Sales Decline” -- but Anthony Mason's story explored only the negative, as he focused on rising foreclosures and declining sales, and even managed to spin the climbing home prices into a dire situation. “In a Wall Street conference call, Countrywide's CEO, Angelo Mozilo, had this warning,” Mason stressed. Then, with matching text on screen, viewers heard audio of Mozilo from a day before NAR's numbers were released on the higher median home price: “We are experiencing home price depreciation almost like never before, with the exception of the Great Depression.”

The July 25 NAR press release reported:
“The national median existing-home price for all housing types was $230,100 in June, up 0.3 percent from June 2006 when the median was $229,300. The median is a typical market price where half of the homes sold for more and half sold for less.”
A transcript of the July 25 CBS Evening News presentation of NAR's latest numbers:
KATIE COURIC: In this country, the housing market is going deeper in the dumper. America's Realtors reported today that used homes were selling in June at the slowest pace in four and a half years. If there is a bright note for homeowners, house prices went up for the first time in nearly a year, but just barely. The median price now just over $230,000. As Anthony Mason reports, in this slump, a lot of Americans are losing their homes to foreclosure.

ANTHONY MASON: The numbers in California were shocking. In Los Angeles County, foreclosures up almost 800 percent: From just 287 homes in the first six months of last year to more than 2,500 this year. Across all of Southern California, foreclosures rose 725 percent as rising interest rates drove up monthly payments for borrowers with adjustable rate mortgages.

RICK SHARGA, REALTYTRAC INC: This is something that's cutting across all socioeconomic classes and, in a worst-case scenario, could have a ripple affect across the whole economy.

MASON: This came just a day after the stock market tumbled when Countrywide Financial, the nation's largest mortgage lender, announced sharp increases in delinquencies, even among its good credit borrowers. In a Wall Street conference call, Countrywide's CEO, Angelo Mozilo, had this warning.

AUDIO OF MOZILO WITH TEXT ON SCREEN: We are experiencing home price depreciation almost like never before, with the exception of the Great Depression.

MASON: The latest numbers show existing home sales dropping in every part of the country, down about 7 percent in both the Northeast and the West, almost 3 percent in the Midwest and about 2 percent in the South. It's the fourth straight month of declining sales and Countrywide's CEO yesterday issued the bleakest forecast yet, predicting the housing market won't recover until 2009. Katie.
Brent Baker
Brent Baker
Brent Baker is the Steven P.J. Wood Senior Fellow and VP for Research and Publications at the Media Research Center