The Business Cycle and Buying a Home
There are
times when the economy is brisk and everyone feels confident about their prospects for the future. As a result, they spend money on things. People
eat out more, buy new cars, and….
…they buy new homes.
Then, for one
reason or another, the economy slows down. Companies lay off employees
and consumers are more careful about where they spend money, cutting back on expenses and perhaps
saving more than usual. As a result, the economy decelerates even
further. If it slows enough, we have a recession, which is a normal yet unfortunate portion of the market cycle.
During such a
time, fewer people are buying homes. Even so, some homeowners may find
themselves in a situation where they must sell. Families grow beyond the
capacity of the home, employees get relocated, and some may even find
themselves unable to make their mortgage payment - perhaps because of a
layoff in the family.
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Gretta Sheffer Minnema
Re/Max College Park Realty
(562) 472-8929