Such low interest rates, of course, stimulate the entire construction market. Real estate sales are rising above analysts' forecasts, although the demand for residential real estate remains at a relatively low level. Also read why it is profitable to buy property in the UK.
Most Americans still remember the economic crisis of 2008 and are in no hurry to go into debt. Recall that precisely because of the inability to repay mortgage loans, such «monsters» of the credit and financial sector of the American economy as Merrill Lynch, J.P. Morgan and a number of others began to collapse. And after the bankruptcy of credit organizations, of course, a series of falls of insurance companies began, in which mortgage loans were insured.
What can we say if the world's largest insurance company AIG went bankrupt. But, North America is struggling with this trend, because it understands that real estate sales are an extremely important sector of the economy, because as soon as this industry begins to collapse, it pulls with it all the accompanying ones: it stops production and sale of concrete, rolled metal, non-metallic building materials, reinforced concrete — these are only those materials that are related to capital construction.
And how many more finishing materials, how much it costs without the work of construction equipment, are reduced, or hundreds of thousands (if not millions) of people are temporarily out of work. And off we go: people have no money, they stop consuming, that is, buying everyday goods, food, cars, computer equipment, and everything else. And this, in turn, means that the retail industry is starting to sag. As retail starts selling less, those who produce what retail sells start to produce less, and so on ad infinitum.
That is why the US financial authorities are very well aware of how and where this chain can end, and that from the first world power it is very easy to become lagging behind China and a number of other Asian states. And since demand for real estate is not as good as we would like, it is highly likely that US mortgage rates will continue their decline at another record pace. And therefore, the American real estate market will become an even more popular investment tool.
And first of all, this does not concern ordinary citizens of America, but investors who buy everything cheaper in bad times, and when countries begin to “depart” from the crisis, sell everything much more expensive , of course, making good money on it. Thus, the US authorities support not only their citizens, creating conditions for them to purchase housing on preferential terms, but also create attractive economic conditions for the development of the entire construction industry, including the development of the entire sector of building materials: non-metallic materials (sand, crushed stone, granite, etc.), ready-mixed concrete, metal, etc.
