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Foreclosure Crisis Essay

672 Words3 Pages

In August 2015, the market for new homes in the United States skyrocketed. Low mortgage rates make possible buyers into actual buyers because they want to invest in these homes. New homes prices are rising due to different economic impact. With the economy recovering from the Wall Street crisis people are starting to find jobs again. With income being stable and mortgage being low it’s prime time to buy a home. Many Americans are also having an easier time than before finding a job after graduating from college and are ready to move out and start a new life.
The prices of the homes have gone up by $600 since the previous month. With so many people wanting to buy a new home, homebuilders raise the prices of the home. And property owner also raise their prices due to the demand. This is an example of value (“Scarcity Reveal Values” pg. 21), since there is a lot of demand for it they rise the price so the people who want it most and who can afford it can buy it. Due to income stability demand (“Consumer Income” pg. 82) increases simply because they are able to afford it. Especially with the mortgage rate being low. Having a stable income gives people an opportunity to invest in these new homes and sell them for more in the future therefore …show more content…

In chapter 6 Supply Side (“Prices of Inputs” pg. 73 ) in Cocktail Party states “Supply can decrease or increase if input prices go up or down” proves that the prices of new homes are also increasing because of the scarcity of the employees. Corporate managers wants employees they could pay less but the employee wants to be paid more or else they will not do the job. This means the employees are scarce. Which is why the home prices are also

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