TODAY'S HOT NEWS: BEST FLORIDA CITIES FOR FIRST TIME HOME BUYER

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The US economy has avoided a recession so far this year, despite a sharp contraction in the real estate industry nationally.

The nation's total economic output rose in the second quarter of 2023 at a rate that would amount to 2.4 percent over a full year, an acceleration in growth from the previous quarter.

Consumers and governments at all levels spent more in the second quarter of the year, helping to drive  growth. Investments in nonresidential assets — such as commercial structures, equipment and intellectual property — and private inventory also helped fuel the uptick in economic productivity.

However, the economy was held back by a reduction in exports and a housing industry that continues to trend downward.

Private residential investment was nearly 19 percent lower in the second quarter than at the same point last year. Since then, the freefall in housing productivity has slowed to an annualized rate of 4 percent in each of the last two quarters.

Moving forward, the existing sales market is likely to remain depressed while mortgage rates make moving a less attractive financial prospect for homeowners.

This is likely to remain a weight on the broader economy, as the housing sector as a whole is still subtracting from, rather than contributing to, overall growth.

Despite the challenges facing the real estate industry, the overall economy appears to be in good shape. Consumer spending remains strong, and businesses are investing in new projects.

However, the risks to the economy remain, and it is too early to say for sure whether the US will avoid a recession in the coming months.
 

What does this mean for real estate professionals?

The continued contraction in the real estate industry is likely to make it more difficult for real estate professionals to close deals. However, there are still opportunities for those who are willing to adapt to the changing market. And it has always been that way. Adapt or perish.