ECON 102 Lecture Notes - Lecture 2: Truism, Feedback
Document Summary
Economic indicator of the day: existing home sales. The housing market in july: 5. 39 million annualized units sold. A pace of 5 million is normal & sustainable: median home price = ,100. C: months supply of homes = 4. 7 (how long it would take to sell all in supply) Tight market due to strong demand & limite inventories. Months supply equation: inventories/monthly sales = 2. 13 million/0. 449 million = 4. 7 months. Rise in average age of first home purchase. Changing homeownership attitudes relative to renting (more want to rent for longer: strong job growth, rising incomes, and rising confidence, some households suffer from impaired credit. Supply-side factors: low inventory of homes ( underwater (home value < mortgage loan value) households are hesitant to list home, high rents limit home sales (people rent out their homes instead of list them for sale)
