but today both value of money and property are going down?
what is the ultimate reason why are the real estate in US is falling?
2007-10-09 18:38:25 · 4 answers · asked by Gwapings 1 in Social Science ➔ Economics
Because this time, the decline in the dollar is accompanied by a simutaneous credit cruch and increased risk. Any increase in foreign demand for RE assets that is caused by the lower value of the dollar is being trumped by reduced demand and increased supply from lower credit availability and higher volatility.
2007-10-09 19:27:05 · answer #1 · answered by Homer J. Simpson 6 · 0⤊ 0⤋
Real estate prices in many cities have increase beyond sustainable levels over the last several years so it was inevitable that the prices would fall, no matter what else was happening in the economy. Also the relationship between the value of the dollars and the prices of real estate or any tangible asset, has more connection with domestic inflation than the exchange rate. Inflation tends to persist so people are looking at multi-year losses in real value of financial assets, where as the fall of the dollar is probably a one time event to correct for our trade imbalance, and it is too late to protect your assets. In any case asset protection could best be accomplished by buying foreign assets, not domestic real estate.
2007-10-09 20:42:15 · answer #2 · answered by meg 7 · 0⤊ 0⤋
Decrease
2016-05-20 04:20:31 · answer #3 · answered by ? 3 · 0⤊ 0⤋
People have more faith in the value of material things such as houses. Money is only valuable because the government says it has value.
2007-10-09 18:47:01 · answer #4 · answered by Anonymous · 0⤊ 1⤋