Housing Market Post and Pre Recession Lab Report

Housing Market Post and Pre Recession - Lab Report exampleAs a result, this recession ended for four quarters. Finally, the last recession that occurred, took place not so pertinacious ago. It started in the 4th quarter of 2007 and lasted until the 2nd quarter of 2009. As can be verified from show 1 below, all these recessions by definition are identified with bar markers in periods that have followed such declines in GDP for three consecutive quarters. An important point to note here is that the length of the recessions has increase over time. The first and second recessions in the duration lasted for two quarters, the third lasted for four quarters and the fresh recession has lasted for seven consecutive quarters. The cyclical pattern of existent GDP is also evident from var. 1. In the initial period, right after the recession, the percentage change of GDP rose shrewdly until the maiden quarter of 1984 and then stabilized and expressed some volatility and then started fal ling in the last quarter of 1989. The decline continued and became a recession lasting for two quarters. The ensuing climb was volatilizable, save the trend was positive until GDP result reached a peak of 10.25% in the 2nd quarter of 2002. It started declining sharply there on and this drop became the 4 quarter long recession of 2001. There was a volatile and slow but steady climb until the last quarter of 2006 whereon the GDP growth rate started plummeting and this tag the onset of the modish recession. The decline in the rate of growth of GDP was most substantial during this latest recession. Figure 1 Movement of GDP The first indicator of the housing market that will be considered is the real(a) average housing price. These are presented in Figure 2 along with the markers for recessions. The movements of the housing prices show very strong cyclical behaviour. Further, taking a closer look reveals that the trends almost mirror those of the real GDP growth, although the vola tility is substantially lower. The movements of the housing prices on average are smoother, though the beginnings and the endings of the cyclical rises and go coincide with those of the real GDP growth in general. Figure 2 Movement of average real house prices Next we turn to Figure 3 which presents the movements of months supply of houses for the period downstairs consideration. From the graph we see that months supply of houses falls in periods during or immediately pastime a recession. This is in contrast to housing prices which we saw follow the pattern of real GDP growth and, thus, slow down before the onset of the recession and start rising during recoveries. Figure 3 Movements in months supply of housing Specifically, from Figure 3 we find out that months supply has at peace(p) down following all recessions in general. Following the recession of 1982, housing supply has reflected as push aside decline in overall trend, although it has hovered around an average. The decli ne is more pronounced in the aftermath of the beside recession. There was a substantial decline in this phase and the declining trend continued onto the third recession. It picked up around early 2005 and sharply rose reflecting the housing bubble and reached its peak in the middle of the fourth recession. Another point worth noting from the graph is that the series has exhibited significant volatility and the latter seems to reflect a lagged reaction to it in the GDP series. The final indicator we look upon in this discussion is the dynamics of