Rising house prices are better for economic growth
Tejvan Pettinger, 22. Studied at LMH and Oxford University; economics professor and writer. 4-24-22. “How the housing market affects the economy.” https://www.economicshelp.org/blog/21636/housing/how-the-housing-market-affects-the-economy/.
Rising house prices, generally encourage consumer spending and lead to higher economic growth – due to the .
A sharp drop in house prices adversely affects consumer confidence, and construction and leads to lower economic growth. (falling house prices can contribute to economic recession)
Rising house prices can also redistribute wealth within an economy – increasing the wealth of homeowners (primarily older people), but reducing effective living standards for those who do not own a house (often the young)
House price drops in 1990 and 2007 – corresponded with the and the .