Supply and Demand Paper

Supply and Demand Paper

Scott Alan Berger Jr.

XECO/212

6/3/2012

Jonathan Keisler

Supply and Demand Paper

Not too long ago I bought a new house which was my first house ever. It was one of the hardest things that I have done in my life because it was a lot of money and a very long investment; I was 21 at the time and was buying something that I would be paying for the next 30 years so longer then I had been alive at this point. I live in California so houses are not on the cheap side unless you are ok with living in some of the bad parts which would not do well for me because I travail a lot and the house was going to be empty a lot of the time. The time it took to find the house I liked in a area I liked and at a price that I could meet took over 6 months and daring that time I went though many different options and found some that had things I liked over others and things I like about the others which made it very hard.

When I started to look into getting a house there were a lot of factors that just happened that pushed the price down all over and really made it so that I could buy the house that I have now. The few years before I started to buy my house the housing market was in a booming state and they could not build the houses fast enough to meet the demand there was at the time so the prices where way up. The house that I bought was over $450,000 at the time it was made in 2005. Then a lot of people started to lose their jobs or had pay cuts so there income was reduces and not as many house were being bought so the demand started to go down but the supply kept growing. Then a few years later around 2009 and 2010 a lot of people that had bought a house on a 5 year arm had the payments go way up because the rates on the loans went up and they could not make the payments any more.

A lot of people started to loss their houses and because of these the supply went up even more as the demand fell and because of this price started to fall like mad...