America's housing market is raising a 'large red flag' for the economy
Source: Yahoo News
The US housing market is slowing down.
Friday's report on US economic growth spurred a presidential victory lap after it showed that gross domestic product rose at a 4.1% annual rate, the fastest in nearly four years.
But it had an ugly detail about the housing market that added to evidence of a slump: Residential investment, which includes construction and brokers' fees, shrank in the second quarter for a third quarter out of four.
Add this to the worst housing affordability in nearly a decade and rising mortgage rates, and you have a recipe for a slowdown.
Read more: https://finance.yahoo.com/news/america-apos-housing-market-raising-145500807.html
sandensea
(21,626 posts)As health costs skyrocket, many would-be homebuyers are beginning to stay away.
Yes, rates are (slowly) rising too - but that should typically bring in more buyers (at least for a while), not less.
blue-wave
(4,352 posts)are part of the overall economic problem, but also are tang heads tariffs. They will prove disastrous. We are just beginning to see the negative consequences of his tariff actions. Add to that the corporate welfare tax cuts of which the middle and lower classes are reaping very little if no benefit at all. Am I missing anything? His knee jerk policies will make the Bush 2007 "great recession" look like a picnic in the park.
PoindexterOglethorpe
(25,851 posts)Sometimes people buy houses at a faster pace than at other times. Lots of factors will influence that. If people start thinking that everything must always grow -- like buying houses -- they're not really thinking about the overall implications.
The economy is incredibly complicated, and I don't pretend to know very much. But I do understand that the underpinnings of the economy are predicated on growth only. A steady state is not acceptable. Everything must grow: wages and consumption both. Any time both of those don't grow we have an economic contraction, a recession or a depression. But the scary truth is that the carrying capacity of this planet is limited. Growth is not sustainable indefinitely.
dixiegrrrrl
(60,010 posts)and that is exactly what the problem is with capitalism, as it is defined today. Not sustainable.
All the tricks the big companies are using to reduce costs, which usually lands on the workers, and basing bonuses on beating yeserday's profit, have to crash.
Problem is, when you increase profits that are accounting tricks, like massive buybacks of a companies stock, you end up with false values.
It ain't real,and a lot of people get hurt when that becomes evident. The lucky few at the top usually come out ahead, they get to keep the money they earned on illusions.
altho, as we saw in 2008, a few very big companies collapsed when their bubble burst.
Happens again and again with no evident learning curve.
7962
(11,841 posts)I think my parents bought their first home back in the 60s with a 5% rate. My 1st home was an assumed loan at 9-1/4% in '82 and everyone thought I stole it. A friend re-fi'd her home a few yrs back for 2.75%!! Thats the lowest of any I know of
Perception is a huge part of any market, but its a hard part to qualify.
dembotoz
(16,802 posts)the phrase the rent is too damn high
valid then valid now