Lower existing home sales numbers may have played a role in causing the stock market to decrease two percent yesterday. That's funny to think about. Our economy is partially dependent on people trading existing houses with one another. The houses are durable. They're going to be around for a long time, regardless of who owns them. What the economy needs, though, is for people to trade them with one another frequently. We can't have the same people just continuing to own the same house for a long period of time.
I am not knowledgeable about exactly why some observers see people trading houses as a positive thing. Maybe this is just an idea that the real estate and finance (FIRE) industries have promoted because they get a cut of most residential real estate transactions. If people are voluntarily giving Realtors and banks their money, maybe this bit of GDP is as legitimate as if people were voluntarily giving their money to buy a new toys.
It's more likely related concerns about keeping real estate liquid, which is important for people who own/owe debt collateralized by real estate.
Whatever the reasons, it would be good for our economy not to be dependent on people moving house frequently.
Subscribe to:
Post Comments (Atom)
maybe the reason you get so few responses is that people are all horrified at your elitist views?
ReplyDelete