June 10, 2012
Internet Article Review
Real Estate and the Economy
Today's current economic state and financial crisis has a lot to do with the current real estate market (Relationship Between The Real Estate Market And The Economy, 2010). This is because the economy and the real estate industry are entangled in interrelations. What this means is that whatever occurs in the economy impacts on the real property market. When the stock market bubble burst in 2000, the fast and furious rise of real estate prices helped the world's financial busts (Economist: Housing Bubble 'Biggest in History', 2005). However, those rises were not something that that should have been expected to continue forever, people were not prepared for the collapse (Economist: Housing Bubble 'Biggest in History', 2005).
The world is still feeling the downward financial system on a global basis (Relationship Between The Real Estate Market And The Economy, 2010). The loss of work, unemployment and the foreclosures of real properties have initiated the massive plunge of the financial sector (Fx Trading Stock, 2012). All this lends to the fact that the lack of people's ability to comply with their financial and payment commitments to their loans, such as their mortgages. This non-compliance to compensate for his or her home loans will result in the foreclosure and or short sale , this in turn hurts the economy as the whole of the people will have to pick up the loss and with so many, this in turn hurts everyone.
Interest rates, Employment and World events
A business, like the real estate market, operates in reaction to what happens outside of its office and this will affect the main functions of the business ( Alexander, 2012). The effects could possibly be the objective of that business and its strategies. Markets change all the time and depending on the products and what