BIC
History of Housing Prices
Just came across this video about the relationship of the price of houses and the economy, depressions and all that financial business.
I´m no financial expert or familiar with how the US Fed system works so a few views would be productive.
Why do house prices play such a big role in the economy?
why don´t people live in one of these big mobile homes, and the companies where they work allow them to live on some land and save the hassle of buying a house, the risk of loosing out big style or getting your house wiped out by a hurricane or flood?
looks like embedding aint working so heres the link
http://www.youtube.com/watch?v=ca_aOvZPh-g
YouTube video
SC
Symmetric Chaos
Fractal King
Re: History of Housing Prices
Originally posted by Bicnarok
Why do house prices play such a big role in the economy?
It's not the house it's the property. Land is the ultimate in limited commodities.
Originally posted by Bicnarok
Why don´t people live in one of these big mobile homes, and the companies where they work allow them to live on some land and save the hassle of buying a house, the risk of loosing out big style or getting your house wiped out by a hurricane or flood?
There's are huge cultural and social factors to wanting a house. Sensible people buy property in a place where losing it is unlikely, this allows it to be passed down family lines. It's also harder to lose land than a trailer.
JAD
Re: History of Housing Prices
Originally posted by Bicnarok
[B]Just came across this video about the relationship of the price of houses and the economy, depressions and all that financial business.I´m no financial expert or familiar with how the US Fed system works so a few views would be productive.
Why do house prices play such a big role in the economy?
why don´t people live in one of these big mobile homes, and the companies where they work allow them to live on some land and save the hassle of buying a house, the risk of loosing out big style or getting your house wiped out by a hurricane or flood?
looks like embedding aint working so heres the link
http://www.youtube.com/watch?v=ca_aOvZPh-g
It's not the house prices but the buying and selling of those houses that impacts the economy. Most people buy houses using a mortgage based on credit. Obviously the money paid back is higher than the value borrowed....The gamble is that if you sell up then you make more than the house value you paid plus the value of the interest paid on the mortgage.
One of the reasons for the current economic problems is that banks are less and less willing to lend money to people for buying a house. This means the whole system jams up. It should be noted that if one buyer isn't able to secure a mortgage then the person they would've bought from can't sell and so can't buy another house and it causes a chain reaction down the line. Eventually the whole housing market slows down and so any taxes based on profits made as well as stamp duty etc on house sales is lost thus further compounding the problems for the government and the economy.