Real Estate Slow Down Or Opportunity?

We’ve been hearing about the housing slow down now for months.  The real estate slow down means homes on the market for sale are taking longer to sale.  In some areas of the USA the length of time to sell a house is now hovering around 69.5 days on the market.  This high number of days before an offer is presented and accepted is an indicator that potentially we may have an economic hiccup in our near future.

The US economy is heavily tied to the housing market.  If the housing market is slowing down, economic indicators point to a down turn in economic growth.

According to Buildfax’s reports, single family construction is cooling off this year which is a prime predictor of a possible recession.

They also reported that current homeowners are postponing their remodeling of their homes for now. All of this information validates what we are being told that about the real estate market.  Homeowners are reluctant to tie up their ready cash into any home improvements or upgrades or take out a home improvement loan for this purpose.

We have to ask ourselves some questions to weed through all of the information that floats around and determine for ourselves what is really going on here.  What signals are homeowners and potential homebuyers receiving from our economy currently to conclude to forgo purchases or home improvements?

Here are some additional economic indicators to consider.  Manufacturing is slowing down. Lumber prices are sliding down which is a direct correlation to housing.  Industrial commodity prices are falling.  Consumer spending is holding strong.  This information would appear that consumers are just buying what they need and not considering housing purchases for now.

We have to ponder the question what does the American people sense or know about the economy that would curtail their purchase of a home of their own?  Is it job insecurity and stagnant wages along with inflation on costs of goods and services?  Seems we are supposed to accept that every year taxes, costs of goods and services continues to rise which causes the cost of living to increase annually as normal.

Could President Trump’s trade war with Mexico and China cause the loss of jobs as well as higher prices on imported goods.  We have to ask ourselves why our leaders allowed our manufacturing jobs to leave our shores and why are we now so heavily dependent on foreign manufacturers for all of our needs here at home.  We have a student loan debt crisis in the making that has to be factored into the mix. See my article on this brewing problem on student loans.

Student loan debt has left many college graduates living at home with their parents that are working or underemployed that can’t afford to move out on their own.

The conclusion I come to is possibly as a nation, we are paying down debts and saving money.  Having money stashed means that when and if the down turn comes, some people with a vision will be able to take advantage of the lower prices on real estate and purchase a home or pick up some rentals to add to their assets for passive income.

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Post Author: Bria