What The New American Economy Means For Real Estate Sales

What The New American Economy Means For Real Estate Sales


0 Flares Facebook 0 Google+ 0 LinkedIn 0 Twitter 0 0 Flares ×

economy New data on the state of the U.S. economy reveals a nation less wealthy than many might imagine. So what   do the numbers really look like, and how will they impact real estate?

 New figures show a huge percentage of the U.S. population barely living above the poverty line, let alone  surviving pay check to pay check. Unfortunately, outside of the tech and real estate industries, job  growth hasn’t improved much either. The most recent statistical roundups show unemployment claims  growing and the national economy essentially flattening out with a 0.5% bump to GDP. So what does it all  mean for the U.S. real estate market in 2014 and beyond?

America is still one of the wealthiest nations in the world. Even the poorest in America often live far better than most in the rest of the world. However, it is important for homeowners, renters, real estate professionals and investors to recognize the disparity and real state of the economic situation in the country in order to position themselves best.

According to the numbers, nearly one third of the population continues to live ‘hand to mouth,’ that is paycheck to pay check. That’s millions of Americans. High-end homes and luxury condos continue to dominate the media. However, even in swanky destinations like Miami, there is incredible disparity. Miami is home to at least 2% of the entire planet’s billionaires. Yet, a massive percentage of the population in Miami now lives on an average of just $11 dollars a day according to coverage by Fox News. Even the average worker making $40,000 a year can find it hard to make ends meet, and even harder to get ahead. $40k doesn’t go that far, especially when having to live in high cost areas to find work, and trying to feed a family.

Home prices and rents have been rising rapidly across the country. While this has been great for institutions, homeowners, and real estate investors, it has proceeded to price many out of housing altogether.

Perhaps even more significantly, this all highlights the immense need for more affordable housing, and lots of it. So while high-end homes may be licensed printing presses for real estate investors to make a mint from wealthy global investors, others will still find plenty of volume and perhaps a more meaningful mission in providing affordable housing.

The good news is that even though so many American residents are living hand to mouth, they are investing in hard assets versus liquid savings, which can so often be tapped for frivolous items on a whim. This makes the outlook for home sales and rent-to-own options bright.

Self-directed IRAs are also increasing in popularity as a vehicle to reduce tax, and increase savings performance. These IRAs could help boost the popularity of real estate even further. Even in the higher income brackets, many Americans continue to live pay check to pay check. As rents are raised and life changes force people to move, this will put a lot of pressure on this group, who may make great money, but lack the funds to move.

– See more at: http://www.cthomesllc.com/2014/05/new-american-economy-means-real-estate-sales/#sthash.jytlK3Hf.dpuf

Leave a Reply

Your email address will not be published. Required fields are marked *

Top
0 Flares Facebook 0 Google+ 0 LinkedIn 0 Twitter 0 0 Flares ×