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Last updated on February 2nd, 2021 at 05:55 pm
To have a roof on our head is the biggest security every human being has. A home is a symbol of our need, security, and our status too.
It is a place to live and we often buy one and more as an investment. The 2nd reason is it tells us about the wider economy in general.
As Dean Baker has been known to remark we were definitely going to get a recession in 2008 whatever happened to Wall Street.
For there was an $8 trillion decline in the housing market. There really is something called the “wealth effect” and when we think we’ve got less wealth then we’ll spend less.
If the housing market tanks then we will spend less, save more, there will be a recession.
U.S. house prices fell in May, down 0.3 percent from the previous month, according to the Federal Housing Finance Agency (FHFA) House Price Index (HPI).
House prices rose 4.9 percent from May 2019 to May 2020. The previously reported 0.2 percent increase for April 2020 was revised downward to 0.1 percent.
CoreLogic data scientists and thought leaders regularly provide insight into housing economies and property markets.
The CoreLogic Home Price Index rose 0.7% in May from the previous month and advanced 4.8% year over year.
The home sales, which were facing heavy losses in May and April raised 20.7 percent in the month of June.
Similarly, the construction of new housing, which is considered as the biggest support to the economy, is also recovering back after a short lull.
Mortgage applications increased 4.1 percent from one week earlier, according to data from the Mortgage Bankers Association‘s (MBA) Weekly Mortgage Applications Survey for the week ending July 17, 2020.
Overall the turnover in the housing market is doing absolutely fine and recovering well from the pandemic lockdown.
We’re not in the middle of a boom that’s going to drive the whole economy, which is good for those always, do eventually, lead to busts.
We’re also not in a bust, that cause of our last deep recession.
When we look at the housing and investment it is not too bad and we endnote worry at least as of now. Housing seems to be responding to real incomes and population numbers, as it should do.
Thus real estate investment, subject to those details of location and the specific property, looks just fine as an investment sector.
We have observed with the existing data that the American real estate industry is doing absolutely fine.
Reference Source: Seeking Alpha
