Where the US economy will be a year from now

Where the US Economy Will be a Year from Now

Introduction

The US economy was growing steadily for the past years . Currently however , the US is facing challenges pertaining to the economy . Some troubles began to manifest as early as 2006 when a sharp decline in the housing starts was first observed . The subprime mortgage crisis occurred . Stock market crashed and investors fleed . The economic slump continued and the dreaded recession occurred . US officially announced it was in recession in December 2008

Deflationary House Prices in the US

Once the

economic crisis sets in , households at the lower income bracket felt the pinch the most . People with no savings have no fall back option . They are paying money for home mortgages but money becomes scarce . Consequently since they are unable to pay the mortgage and their houses get foreclosed

Another effect of the deflationary house prices in the US is that foreclosed homes now created a growing list of unsold houses either old or new inventories . This situation is more pronounced in certain markets such as urban Florida , California , Nevada , Atlanta and others The lack of buyers for these houses cause the prices to stabilize or in most cases , they go down

Once residential markets experience this problem , potential homebuyers will not commit to buying a house . This is because they want to hold on to their money until the home prices go down to its lowest level Thereby giving their money a lot of leverage . What can be bought...