Real Estate Is a Driving Force in the Economy

As the economy recovers from this year’s health crisis, the housing market is playing a leading role in the turnaround. It’s safe to say that what we call “home” is taking on a new meaning, causing many of us to consider buying or selling sooner rather than later. Housing, therefore, has thrived in an otherwise down year. Today’s high buyer demand combined with low housing inventory means we’re seeing home prices [appreciate](https://www.simplifyingthemarket.com/2020/10/22/home-values-projected-to-keep-rising/?a=550432-7d0dd2250a392515b4ab3273bfa644ce) at an above-average pace. This demand is being driven by those who want to take advantage of historically low mortgage rates. According to [_Freddie Mac_](http://www.freddiemac.com/pmms/): > _“The record low mortgage rate environment is **providing tangible support to the economy at a critical time**, as housing continues to propel growth.”_ These factors are driving a positive impact on the economy as a whole. According to the _National Association of Realtors_ (NAR), the real estate industry provided **$3.7 billion dollars of economic impact** to the country last year. To break it down, in 2019, the average newly constructed home contributed just **over $88,000 per build** to local economies. Across the country, real estate clearly makes a significant impact _(See map below):_[](https://i0.wp.com/cherylbowerrealestate.com/wp-content/uploads/2020/11/20201104-MEM-Eng-1.jpg?ssl=1)In addition, last week, the [_Bureau of Economic Analysis_](https://www.bea.gov/news/2020/gross-domestic-product-third-quarter-2020-advance-estimate) announced the U.S. Gross Domestic Product increased at an annual rate of 33.1% in the 3rd quarter of this year, after decreasing by 31.4% in the second quarter. There’s no doubt the growing economy is being fueled in part by the soaring housing market. Experts forecast this housing growth to carry into 2021, continuing to make a big impact on the economy next year as well. ### **Bottom Line** The American Dream of homeownership has continued to thrive in the midst of this year’s economic downturn, and “home” has taken on a new meaning for many of us during this time.  Best of all, the housing market is making a significant impact as the economy recovers.