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Housing Market Positioned to Bring Back the Economy

Housing Market Positioned to Bring Back the Economy | MyKCM

All eyes are on the American economy. As it goes, so does the world economy. With states beginning to reopen, the question becomes: which sectors of the economy will drive its recovery? There seems to be a growing consensus that the housing market is positioned to be that driving force, the tailwind that is necessary.

Some may question that assertion as they look back on the last recession in 2008 when housing was the anchor to the economy – holding it back from sailing forward. But even then, the overall economy did not begin to recover until the real estate market started to regain its strength. This time, the housing market was in great shape when the virus hit.

As Mark Fleming, Chief Economist of First Americanrecently explained:

“Many still bear scars from the Great Recession and may expect the housing market to follow a similar trajectory in response to the coronavirus outbreak. But, there are distinct differences that indicate the housing market may follow a much different path. While housing led the recession in 2008-2009, this time it may be poised to bring us out of it.”

Fleming is not the only economist who believes this. Last week, Dr. Frank Nothaft, Chief Economist for CoreLogic, (@DrFrankNothaft) tweeted:

“For the first 6 decades after WWII, the housing sector led the rest of the economy out of each recession. Expect it to do so this time as well.”

And, Robert Dietz, Chief Economist for the National Association of Home Builders, in an economic update last week explained:

“As the economy begins a recovery later in 2020, we expect housing to play a leading role. Housing enters this recession underbuilt, not overbuilt…Based on demographics and current vacancy rates, the U.S. may have a housing deficit of up to one million units.”

Bottom Line

Every time a home is sold it has a tremendous financial impact on local economies. As the real estate market continues its recovery, it will act as a strong tailwind to the overall national economy.

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Jean Becklund is a Luxury Real Estate Agent for EXP Realty. Jean has been living on Maui the past 36 years and has been a licensed real estate agent the past 16 years. Her knowledge of the market is vast. She does not limit her self to one area, she is familiar with resort properties, residential, vacant land, and the process it takes to build a home on Maui. Jean has had first hand experience she bought her first home in 1995 in Maui, owned 3 rental condo's, and designed and built a plantation home in 2005 where she resides today. Jean is the mother to 2 daughters Hayley who is her Broker and business partner and Chloe who is a waitress. Jean's sister Maureen used to tell her of the gentle rain and rainbows when she came to visit in the 1970's, that never left her mind. She moved to Maui in 1987 with a one way ticket and a set of golf clubs, landed her first job at Makena Golf Course and worked in the pro shop. Looking back those were the most precious days in Maui, a simple quiet life. Jean still heads back to Makena for her early morning swims. She loves to golf and joined the hole in 1 club in 2010. She plays pickleball daily, snorkels for sea shells and beach glass, rides her bike and plays her ukulele. Jean is also a pet lover with 1 senior dog and 5 cats. Jean loves her island lifestyle and would love to share her knowledge with you. She has a magnetic smile and infectious laugh, call her today!

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