Housing Contradiction: Home Prices Down = Sales Up. Any Questions?
I’m about to reveal an extraordinary secret, one that rivals the coordinates for the lost city of Atlantis. As experts and government officials are now in their second year of scrambling for housing solutions it appears that we have found one that works. Here it goes; when you lower prices you actually move sales! Astounding! This is one of the most basic points you learn in economics:
Take a look at the graph. Inventory is still very high so the supply curve even with current sales is holding steady simply because of the increase in distressed properties. This has maintained a very high amount of inventory on the market. Prices for a very long time held steady so demand did not move adding further fuel to the growing inventory numbers. Now, we are seeing major price reductions and sales are increasing. Well […]
Original post by drhousingbubble
