Litchfield home buyers and the home sellers they will negotiate with have at least one thing in common—it has to do with that famous saying about misery loving company. Misery in all its forms is never welcome because miserable anything doesn’t lead to a lively real estate market. A miserable economy doesn’t help home sales activity any more than miserable weather helps an open house’s traffic count.
That’s one of the main reasons why back in the 60s government economist Arthur Okun created what he called the “Misery Index.” He was trying to develop a single number that combined the factors that can create hardship for average consumers. A high Misery Index number meant trouble for families striving to improve their circumstances; a low number indicated removal of those impediments. Because buying a home is the largest purchase most Litchfield consumers ever enter, the Misery Index is a relevant bellwether for Litchfield home buyers and sellers alike. The Index uses the inflation rate, unemployment data, GDP and interest rates to come up with its result.
Long story short: misery-wise, we’re in pretty good shape!
According to the latest calculation, the nation has experienced a fairly uniform decline from the recent January 2017 peak of 7.3%—which was already a low number. In fact, September’s Misery Index of 5.98% was the first drop beneath 6% in more than a year. For comparison, during the gasoline shortage and inflation crisis of 1980, the Index reached the “malaise”-inducing peak of 21.98%.
At today’s 5.98%, it might seem to be time to rename it the “Happiness Index.” But as we all know, sooner or later circumstances will change, as they always do. Right now, the decidedly un-miserable circumstances are favorable, but in other words, as far as the Misery Index is concerned, today’s environment is creating more economically advantaged consumers. For prospective Litchfield home buyers who are feeling those effects, this fall could be the time you’ve been waiting for—time to give me a call!
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