Blame Television for the BubbleI don't know the name of the show we were watching, but it was one of these on HGTV that has experts coming into homes and telling anxious owners whether or not they had enough equity built up for them to make improvements or to sell at a tidy profit and buy bigger (yes, I do; it was this one). My reaction? "Surely, this was taped before the housing crash. There's no way these homes are worth what these 'real estate experts' are telling these gullible homeowners. And look at how nervous those owners are as the verdict is about to be handed down. What in God's name would make people so insane about the value of the four walls around them?"
By Jim Sollisch, writing in the Wall Street Journal
So now we know what happens when too many people who have too few assets buy too much house with the help of too many risky mortgage products and too little oversight. And while there's plenty of blame to go around -- unethical mortgage brokers, greedy bankers and irresponsible homeowners -- one culprit continues to get off scot-free: HGTV.
That's right. The cable network HGTV is the real villain of the economic meltdown. As the viewership reached a critical mass over the past decade -- HGTV is now broadcast into 91 million homes -- homeowners began experiencing deep angst. Suddenly no one but the most slovenly and unambitious were satisfied with their houses. It didn't matter if you lived in an apartment or a gated community, one episode of "House Hunters" or "What's My House Worth?" and you were convinced you needed more. More square feet. More granite. More stainless steel appliances. More landscaping. More media rooms. More style. You deserved it.
[O]n episode after episode for this entire irrational decade, HGTV pumped up the housing bubble by parading the most mediocre, unworthy-looking homeowners into our living rooms to watch while they put their tacky, run-of-the-mill tract homes on the market for twice what they paid and then went out and bought houses with price tags too obscene to repeat. You couldn't watch these shows without concluding that you must be an idiot and a loser if you lived in a house you could actually afford. [link]
But insane many became. And then the crash became.
It might be a tad excessive to blame HGTV for this. But HGTV certainly provided (still provides*) a window into that manic world of self-delusion. A window into collective madness.
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* While I'm on the subject, I'll tell you what I found particularly annoying about this. The female star of this particular show will bring an expert into a home and determine, based on purchase price, plus the cost of upgrades, and minus the estimated resale value of the home, what the homeowners' "profit" is.
Yup. That's the word she uses. But the profit on something not yet sold - as everyone knows - is zero.
And we wonder why the housing sector went bust ...