Every quarter, housing makes a huge contribution to US Gross Domestic Product (GDP). GDP is one of the main indicators used to measure the health of our country’s economy. According to Investopedia.com, it “represents the total dollar value of all goods and services produced over a specific time period.” For the most part, GDP can be seen as the ‘size’ of the economy, and when it grows, it shows the economy is improving.
As the third quarter of this year closes out, we find that housing had a huge part in economic growth. The National Association of Home Builders reported that housing’s share of GDP was 15.6 percent in this quarter alone! Of that 15.6 percent, new home construction accounted for 3.2 percent.
The housing market contributes to GDP in two ways: through residential fixed investment (RFI) and the measure of housing services. RFI specifically measures home building, as well as remodeling. At Bayside, we’ve recently welcomed new builders to join our community. Adding to the townhomes and single-family homes built by NV Homes, are villas and single-family homes by Schell Brothers. Marnie Custom Beach Homes and Echelon Custom Homes are also new to Bayside, offering a custom home program to future residents. The construction of these new homes will help to boost Sussex County’s local economy and job growth, as well as contribute to the nation as a whole.
Since 2011, the rate of RFI improvements have increased by $119 billion, totaling to $728 billion in GDP growth, as measured in 2009 dollars. With these measurements, home building growth has remained well above 16 percent of overall GDP growth for two years.
Housing services include monthly rents, or what the owner would deem an acceptable monthly rental rate, and utilities. Housing services totaled to 12.4 percent of the economy in the third quarter. The weight of RFI and housing services on GDP only prove the importance and impact of the housing market in the U.S. economy.
To know that the housing market contributes in such a great way to our nation’s economy is great to hear! Knowing that the new homes at Bayside have also helped the growing economy is even better. As the economy improves, more and more people will be able to buy a home they love, in a neighborhood they love. And, what better place to have a home than our very own beach community? With an extensive list of amenities and so many fun things to do, as well as the beautiful new homes, Bayside is ideal for everyone from retirees to families with kids.
Source: The National Association of Home Builders