Housing’s Revival Losing Some Heat

Problem number one: Not enough growth in jobs and wages.

Don’t expect the housing market to rev up the economy much this year. After two years of robust gains in construction, sales and especially home values, growth is now easing.

Overall, housing will add about 0.2 of a percentage point to GDP this year—roughly the same economic lift that it provided in most of the 1980s and 1990s, but just half of the boost the sector delivered during the boom years of 2002-2006. In 2014, look for housing to add about a third less than its contribution in 2012-2013.

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Gillian B. White
Reporter, The Kiplinger Letter