Question Remains On Trade Tensions And Possible Effects On Real Estate Buyers
The rise and fall of real estate markets have been more noticeable lately because of the various tensions among countries. Market appreciation has been decelerating while sales have been slowing and a potential recession is weighing heavily on purchases, according to Curbed.
This is what has been happening in the larger world market, where a global slowdown, coupled with the imposition of tariffs between countries, have been treated with uncertainty.
These factors have contributed to the flow of foreign investors out of the US to stay away from the US property market, according to a National Association of Realtors report.
This has resulted in potential sales worth billions of dollars not happening. The annual Profile of International Activity in US Residential Real Estate showed that there is a 36% drop in activity in the market.
The co-author of the report, Gay Cororaton, said that the shift has been due to consumer confidence as much as it is all about the economic slowdown, as well as international politics in play.
To put it simply, she said that confidence to buy property grows when people see a market that's "stable and growing." With lots of instability and a certain dose of uncertainty, she said, the wise will hold off from making any investments, even if it is to buy a house.
Another question that remains is what happens to the "global economy" borne out of the globalization that's been happening? The US-China trade dispute has been making matters worse for this market factor, which had been gaining strength over the past quarter-century. CNBC noted an example where the European Union was making more exports than the US into China because of the dispute.
American businesses have started their search for more partner markets other than just those from China. Imports from China have gone down to about 12.2% year to date, according to data from the government. This trend had the potential to change the global economy, according to Capital Economics group chief economist Neil Shearing.
The tit-for-tat happening between China and the US may signal the end of globalization as businesses know it. The cross-border movements of goods and services may soon be in the reverse, he added.
Other analysts have their own ideas about what might possibly happen because of these after-effects. The toxic trade talks, the negative investments-these may all factor into a significant decline or a noticeable decrease in doing business, at least for next year.