Answering Your Top Questions on Real Estate Economics (Part 2) - EP 79
Jan 4, 2024
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Economists discuss personal savings, unemployment, and fiscal stimulus. Consumer debt, demographics, and future economic impact. Real estate refinancing challenges, rising rates, and neutral rates. Remote work's lasting effect on housing demand and population shifts. Analysis of current house price trends and geographic variances.
Fiscal stimulus lowered personal savings rate, driving consumption, but might deplete reserves next year.
Population changes by 2040 will affect labor force participation, wage growth, and inflation trends.
Deep dives
Effect of Personal Savings on the Economy
Personal savings rate is lower due to fiscal stimulus placing money into savings, driving consumption. The drawing down of savings fuels consumption, but the reserves might deplete next year. Despite potential pressure on the economy, the unemployment rate remains historically low, signaling resilience.
Impact of Debt on Consumers
Student loan debt servicing estimates vary, impacting retail sales spending. Credit card debt has surged to 1.1 trillion, with delinquencies up by nearly 2%. Subprime auto loan delinquencies have reached a 30-year high at over 6%, revealing significant consumer challenges.
Demographic Shifts and Economic Influences
Population changes by 2040 show growth in both young and old demographics, affecting labor force participation and wage growth. Aging populations may lead to lower participation rates, impacting inflation trends. These long-term shifts can influence economic dynamics over the next decade.
In this episode of The REconomy Podcast™ from First American, Chief Economist Mark Fleming and Deputy Chief Economist Odeta Kushi once again gather the entire First American Economics team to address your top questions, this time digging into house prices, office-to-multifamily conversions, demographic trends, inflation, and the impact of work-from-home on housing demand.
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