Many economists think that The Great Recession started in 2007 and ended in 2009, but over a year later Americans, not to mention much of the world, are still trying to recover from its profound effects. Believe it or not, the retail sector has reported the best earnings in all of three years for the holiday shopping season just past, yet houses continue to lose value. These are two of the biggest indicators economists use to gauge the state of affairs, and taken together their mixed message seems to faithfully reflect the uncertainty all around.
Though profits are at record highs, large companies are not taking on any more workers. Interest rates are incredibly low but credit lines remain tight. That’s because people don’t believe the recession’s really over But it’s a vicious cycle, since nobody wants to take those crucial first steps that somebody will have to eventually – a great many somebodys, actually.
The actual number of homes sold nationally this past November was just twenty-one thousand, the lowest figure ever for a single month. Savvy shoppers, however, can take advantage of these conditions, which have lead to low prices throughout the entire real estate market, even for properties in New York City.
This is something that even folks such as Isaac Toussie have not seen before, where price declines seem to discourage sales!
The situation is much, much worse in cities such as Cleveland, Minneapolis, and even Dallas, darlings of the 1990s.
Ultimately, nothing will change on the real estate front without dramatic improvements where jobs are concerned. Yet with no strong sustained positives in real estate – which account for new purchases of durable goods – what chance will there be for the outlook on jobs?
It’s a vicious chicken-or-egg cycle.
No comments yet.