Housing recovery not yet providing substantial boost to U.S. economy

New York /
Nov.November 05, 2012 09:30 AM

As the nation’s housing market recovers, it is not providing the economic kick many where hoping for, MSNBC reported. Despite growth in construction and related industries, and rising home-sale prices, the housing market is still not close to providing the same kind of economic benefits to U.S. as it  had prior to the recession.

Americans are likely to spend approximately $134.2 billion on home renovations in the 12 months leading up to June 2013, which was up from $115.3 billion at the end of September this year, according to Harvard University’s Joint Center for Housing Studies. But that is still 8 percent off the spending peak in mid 2007 — back when home owners were more willing to borrow to make repairs. 

Overall residential investment’s contribution to GDP has fallen from to 2.5 percent in the third quarter of this year — from  6 percent in 2005.

But steady, if slow, growth in housing and related industries is helping to maintain this year’s pace of growth.

“People always ask, ‘What’s going to drive the recovery?’  Scott Brown, chief economist at Raymond James, a financial advisory firm, said. “It’s never usually one particular thing, but a lot of little things getting better at the same time.” [MSNBC]Christopher Cameron


Related Articles

arrow_forward_ios
Exhausting other options, buyers flock to fixer-uppers
Exhausting other options, buyers flock to fixer-uppers
Exhausting other options, buyers flock to fixer-uppers
(iStock)
Up, up and away: Home prices soar beyond buyers’ reach
Up, up and away: Home prices soar beyond buyers’ reach
(iStock)
Canada’s surging housing market may be peaking
Canada’s surging housing market may be peaking
Of the 110 metro areas with at least half a million people, 29 saw losses in 2020. (iStock)
More urban areas lost population in 2020
More urban areas lost population in 2020
Zillow CEO Rich Barton (Getty)
Zillow profits hit record $52M in Q1
Zillow profits hit record $52M in Q1
(Getty, iStock/Illustration by Alexis Manrodt for The Real Deal)
Renters prepare for eviction crisis as aid is held up
Renters prepare for eviction crisis as aid is held up
2468 Kenmore Street in East Meadow (Google Maps)
Long Island man evades eviction for 20 years
Long Island man evades eviction for 20 years
Every region except the Midwest saw month-over-month and year-over-year increases in pending sales. (iStock)
Pending home sales rebound
Pending home sales rebound
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...