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Real Estate and the Economy
Ch. 26 Jacobus
1. Economic Base
a. Ability of a city to produce a commodity or service that can bring in
money from outside its area
i. Primary industries
ii. Secondary industires
b. Effect on Property values:
i. Base industries (Primary industries) are essential.
ii. Diversity of economic base.
iii. Employment multiplier.
2. Cyclical demand on housing
a. Short term increase in demand
b. Inflation softens the impact of decrease in demand.
3. Demand over time:
a. Housing needs and income patterns
b. Consider age distribution on housing needs
4. Governmental Impact
a. Tax Laws
b. Fiscal policy
i. Governments competing with homeowner/investors for money
ii. Monetary Policy - Federal Reserve Board
c. Secondary Mortgage Market
5. Inflation
a. Cost Push
b. Demand Pull
c. Monetary
d. Real Cost