Hidden in the Q3 report on Gross Domestic Product
(GDP) on Thursday, which showed a rebound of 33.1 percent from the 31.4 percent
loss in Q2 was news of some real growth. Robert Dietz, chief economist of the
National Association of Home Builders points out, in an article in NAHB’s Eye
on Housing blog, that residential fixed investment (RFI), which includes home
building and remodeling, expanded at a 59.3 percent annual rate. Dietz says low interest rates, a renewed focus on the
importance of home, an evolving geography of housing demand, and a lack of
inventory has spurred a “dramatic turnaround” in the housing sector since
spring
. This, he adds, has been a relative bright spot for the economy. Housing’s
share of the GDP remains elevated. In the second quarter, amid the broader
economic weakness, housing accounted for more than 16 percent of the overall
number. As the rest of the economy recovered in the third quarter that share
declined to 15.5 percent. Nonetheless, Dietz says, “Except for the historic second quarter, this is the highest
share for housing since the summer of 2008.”

 

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