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Is the economy changing your housing plans?

Posted by Scott Van Voorhis August 8, 2011 09:00 AM

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Like a lot of people, I thought once a debt default had been averted, things would go back to normal.

Normal as in sluggish economy and messed up housing market - all familiar terrain right now.

I even suggested in my post last Monday that avoiding a debt default had averted Armageddon in the housing market.

Now it looks like I wrote too soon.

OK, so Congress, despite the block headed posturing of the last few weeks, wasn't so completely senseless as to force the United States to default on its debts, effectively pushing the economy off the cliff. But it came pretty darn close - earning an unprecedented 82 percent disapproval rating.

In fact, the long and debilitating debt default debate, coupled with Standard & Poor's decision to jump on the bandwagon and downgrade the federal government's long-held AAA debt rating, has taken its toll.

And anyone who suggests all this won't have a profound impact on the housing market is beyond clueless.

If anything, the global economic outlook looks immeasurably darker this Monday morning than it did a week ago, with the nation on the cusp of defaulting on its debts.

Talk of another recession, not long ago the province of a few doom-and-gloomer economists, has gone mainstream.

All that, of course, raises some huge questions about the housing market - both on the macro and micro levels.

On the macro level, the double dip in prices will only gain speed if the economy, as feared, starts to move in reverse. Fortunately, despite the scary headlines, that's hardly a certainty - the market turmoil comes even despite a mildly encouraging jobs report and still strong corporate earnings. But it's a possibility that can't be discounted.

On the micro level, what is the economic uncertainty doing to your housing plans? If you are looking to buy, are you reassessing your plans or plunging ahead?


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About boston real estate now
Scott Van Voorhis is a freelance writer who specializes in real estate and business issues.

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