Mortgage

Housing leads in U.S. economy growth

While still in recovery, housing is doing better

Housing is taking the front seat in capital spending in the next U.S. economy growth leg, according to an article in Bloomberg. Although, there is still a lot of recovery left in housing.

Homebuilding, which accounts for about 3 percent of gross domestic product compared with about 12 percent for capital spending, matters because of its “broader linkages that will feed back into the economy” to spur household spending, wealth, hiring, and confidence, said Michelle Meyer, a senior U.S. economist at Bank of America Corp. in New York.

But the article explained that this has to provide the typical jolt.

“It’ll be a bumpy housing recovery, but the path is higher,” Meyer said, citing tailwinds from improving employment, credit and historically low mortgage costs. “We just don’t have the housing stock we need to meet demand. Housing has by no means plateaued here.”

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3d rendering of a row of luxury townhouses along a street

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