How Overall Economic Conditions Affect Our Housing Market

Words from Experts:

Lawrence Yun, Chief Economics at the National Association of Realtors, recently spoke out about the overall economy and its impact on real estate with Keeping Current Matters (watch YouTube video here) at the 2019 Conference for the National Association of Real Estate Editors. Here are a few of his key points:

  1. The National Real Estate Market has improved, as evident by the overall increase in U.S. home sales year-over-year.
  2. Both mortgage and interest rates have continued to decrease, thereby prompting more buyers to apply for mortgages, by up to 10% year over year as of 10/2019.
  3. The housing shortage has caused an increase in home prices, however, that inventory is predicted to increase in 2020.
    1. He suggests, in order to expedite this process, we should urge our local government to reduce hurdles for building permits and zoning applications, and/or offer tax credits for low to mid range new home construction,
  4. The economy overall is in decent shape, with the unemployment rate down. However, the main risk, which could trickle down to the RE market, would be a full blown trade war.
  5. In his opinion, of all the economic sectors, the US housing market is one of the safest ones to invest in.

Goldman Sachs posted the following in regards to our current economy overall, that I feel is really pertinent:

Goldman Sachs Research forecasts steady U.S. GDP growth of 2.3%, driven by easier financial conditions, dissipating trade tensions, and continued strength in consumer spending. As the U.S. economy continues its longest expansion on record, many market participants continue to worry about recession. However, our economists forecast just a 20% chance of a U.S. recession in the next 12 months, compared with the consensus view of 33%.

© 2020 Goldman Sachs: U.S. Economic Outlook 2020: On Firmer Ground

Want a portal into the Multiple Service Listing (MLS), so you can see how our local market fares, for yourself? Send me your email, with “MLS Portal Request” as your subject, and I’ll set up a search for you without any obligation.

Relevant Market Interpretation

I believe in research-based decision making, not scaring people into action. The media loves fear tactics. I have heard repeatedly that the US Economy has been in this bull market “for too long” and a recession is “imminent.” But, technically speaking, there is no limit. I mean, What about Australia!? Australia holds the record for the longest bull market with 28+ YEARS!

In my opinion, financial decisions cause a great amount of stress. Facts, not emotions, should be utilized in such situations. Emotions are unpredictable, whereas facts remain the same, and are more reliable.

All decisions are ultimately YOURS to make. Only you decide who to listen to, and what you base your next move on. Overall, the experts are saying 2020 looks like it could be another good year, for the overall economy and the national housing market. Therefore, I’m optimistic, and I hope others are, as well.

Let me know what you think about the current economy and housing market! I’d love to hear from you! ❤ always, Annie Z.

PHONE 262.348.3253   |   262.215.1982
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