AnIncrease in the Sale of New House is A Sign That an EconomicExpansion is coming.
Mostpeople consider buying a new house as one of the most expensivepurchases. Therefore, when one buys a new house, that person isconsidered economically stable. In some cases, people apply for amortgage loan that will take them many years trying to pay off thedebt. This means that they are confident about their finances in thefollowing years. This confidence of the buyers is a good sign thatthe economic tends to grow in future.
Inaddition, continuous construction of new houses indicates continuousemployments. Normally, construction jobs are better paying comparedto other manual jobs. Correspondingly, increase of construction jobsmeans that most workers will have decent salaries and wages. This isalso an indication of an economic expansion.
Furthermore,as new house are built, there are high chances for more business totake place in them (McEachern,2012).People will hire them to set up business some might be used asshopping malls, banks, and for other profit-making projects.Therefore, construction and sales of new house is a sign that aneconomic expansion is coming.
McEachern,W. A. (2012). ECON Macro 3 (3rd ed.). Mason, OH: South-Western.