RESIDENTAL HOUSINGRESIDENTAL HOUSINGReal estate industry has experienced a serious drop in the state of Georgia in residential housing which it has decreased property value and increased foreclosure rate.
Everything is affected by the by real estate industry just not the housing, job market in my opinion that starts the domino effect with the economy. According to Southeast Real Estate Business Metropolitan Atlanta??™s economy has experienced the effects of a prolonged national recession that struck at the core of the area??™s diversified economy. (Lynn Leonard, 2004)
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With the increase in jobs come the increases in demand. With job lay-offs and unemployment at the lowest that starts the trend of foreclosure on housing with a decrease in property value.
Foreclosures were on the rise because of the lay-offs, payments that was not being paid on time or not being paid at all. Low interest rates and demand have turned consumers to renters instead of buyers. Consumers are looking at special deals such as free utilities or anything that will give them a benefit. Instead of buying houses consumers are turning to leasing or renting with the option to buy. This is partial due to their credit rating. Along with the rise of foreclosures comes the decrease in credit scores, interest rates drop during this time to help out with the economy. Sellers during this time try to develop incentives or specials to bring consumer to purchase or rent. The change and make different strategies in order to entice the consumers
Atlanta remained the top growth area nationwide for population with 108,000 new residents, new housing permits and income levels that grew 10 percent over the national average in the last 5 years. The number of new business relocations and expansions remained stable with 170 new operations, which created 4,690 new jobs and absorbed 4.8 million square feet of space. (Lynn Leonard, 2004) The supply and demand of the economy is not one sided everything is effected by the drop or increase. It may take a few days or months but it will be affected.
With the market dropping in mortgage rates some buyers fill that making a profit by flipping these properties is still rather distant, so they lay in wait for an eventual rebound and in the meantime make money by renting out their properties for more than the monthly mortgage payment. (Lascelles, 2012)References
Lascelles, Eric, (2012) Yes: It??™s a Rare Opportunity, retrieved from
Leonard, Leonard ,( 2004), Atlanta Makes Progress, retrieved from
Law of Demand the best understanding for this would be for me, is retail. Purchasing clothing or at Christmas time when the customer is looking for that hot toy for the Christmas Season or the new Wii for the year. The demand of that one item is high and the customer will pay that price for that hot item, whether it is thirty dollars or three hundred-thirty dollars. They will pay the price because of the demand.
Substitutes I will relate this with when purchasing groceries or better yet medication. At times it is better but defiantly cheaper to purchase the generic name instead of the brand name of the item. The ingredients are pretty much the same if not equal. You are getting the same quantity in some cases quality. Quantity and Quality depends on the individual.
Complements when to items relate to each other and increase a want or a need. An example of this would be when there was a fad awhile back where young teenagers and certain young adults wanted and was wearing white T-shirts. The increase in white T-shirts also increased the demand of individual wearing bagging pants with those white T-shirts.
Price Floor where the price cannot be sold below the minimum legal price. The higher the price the less is sold, the lower the price the more that is sold. A good example of this would be prices for the Golf Master Tournament or concert tickets. There is a minimum amount that the tickets can be sold for, but the ticket is sold a higher rate for better sits or dates. There is a limited amount of sits and dates at the higher rate.