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Economic Influences on the Housing Industry

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How does the economy affect the housing industry? What economic influences affect the housing industry in a negative way?

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The primary influence on construction employment is the interest rate, which is governed by monetary policy. When interest rates are high it is more difficult for people to get loans. Since most real estate is purchased with mortgages, the real estate market contracts during times of high interest rates. There are lots of articles about this effect. In Builder Magazine, an article by Alison Rice entitled Vital Signs: Job Squad describes how construction employment has remained high in ...

Solution Summary

Construction employment as it relates to interest rates. References cited.