The economic growth has been experiencing numerous challenges. The united state economic is affected by both internal and external factors. In an analytical point of view, the current state of the economic relies on the political and social factors influencing the economic sector. For instance, the traditional and cultural practices limit citizens from practicing certain activities that would generate income thus influencing the economic growth. The entry of JA Homes (JAH) into the market faces challenges of high unemployment rates, the inflation in the economy and the entire economic growth (Ortalo-Magné, François, and Andrea 155). JA Homes (JAH) requires to take into consideration the factor affecting the economy in order to be successful in the construction industry.
According to the chart, it elaborates on current trends in the United States economy. The knowledge of the state’s economy would assist JA Homes (JAH) to evaluate its chances of making a break through into the markets. The chart shows that there has been great improvement in the economic growth since the great recession. In 2013 third quarter, the United States recorded an addition five percent of its GDP as compared to the fourth quarter of the great recession (2007 to 2008).
According to recent research, it is evident that the presence of strong and reliable tools in the economy the united state economy managed to recover from the Great recession. It means that the stakeholder in the economy set in place adequate measures that ensure the country’s real GDP increases. The chart indicates that the real GDP has facilitated the production of an additional $843 billion output as compared to that of Q4 2007. The red line in the chart is an indicate of the new level of the output in the economy of United States. It implies that the economic outputs are being facilitated or production by a relatively low number of workers as compared to the number of worker during the final quarter of 2007. It thus means that the factor of unemployment plays a major role in determining the current state of the economy. JA Homes (JAH) should takes note of the rate of unemployment in the country. It would enable it to explore more on the worker potentially by offering a platform for employment and individual growth and development (Ortalo-Magné, François, and Andrea 155).
According to recent research, it is evident that informal rental housing is dominant over formal. The planning procedures are being followed to the letter thus facilitate a high growth of formal housing as compared to informal housing. In other situation whereby property owners and squatter families are taking the initiative of building rental houses in developed or urban areas, formal housing has been on the rise due to the growth the economy. The federal policies and local authority's by-laws are playing a major role in the construction industries. This is because most of the constructions taking places within the united state are in accordance with the rule and regulations governing the act. Therefore, it has led to the construction of the building that are up to standards thus creating a friendly environment for the public. Most of the rental units within areas where houses built exceed the stipulated standards in the purchase agreement are believed to be the main factor leading to the increasing growth of informal rental housing (Charles 75).
According to the statistics collected by American Housing survey (2012), it analyzed that an approximate of 41.7 percent of American are dwelling in rental buildings. In other terms, most of the structures are built on a temporary rental and resale. It means that, the tenancy of rental houses limit the availability of information regarding private rental housing in the country. JA Homes (JAH) Would encounter challenges in the construction industry due to the fact that most of the private developers does not submit their official plans to the local authority for approval, it has resulted to scanty of informal within the entire formal sector.
In this context, housing subsidies is a very fundamental aspect regardless of the fact that it is limited to the public sector. It includes direct government subsidies on the government allocated land for housing developments, housing allowances, and rental houses provided by employees to their respective workers. In United States, tenancy in rental housing is influenced by the market forces especially in the private sector rather than the heavy subsidies brought in the public sector thus standing out as complex concept (Gagnon, Joseph and Brian 478).
JAH builds houses for the middle classes – second, third, and fourth quintiles of the income distribution. Therefore, tenants are subjected to pay rents at fluctuating rates depending on the living standard of that particular area. A good example is the third classes pay high rent as compared to in the middle classes. The prices of renting a house are determined by the size and the specific location. In other terms, houses located near the beach come at higher rates due to the living standards and sizes of the rooms. Income rates and economic growth are among the greatest threats facing JA Homes (JAH) (Badev, Anton, et al 211).
Work cited
Badev, Anton, et al. "Housing finance across countries: new data and analysis." (2014).
Gagnon, Joseph E., and Brian Sack. "Monetary policy with abundant liquidity: a new operating framework for the Federal Reserve." Policy Brief PB14 4 (2014).
Lamb, Charles M. "Race, Segregation, and Housing in America." APSA 2014 Annual Meeting Paper. 2014.
Ortalo-Magné, François, and Andrea Prat. "On the political economy of urban growth: Homeownership versus affordability." American Economic Journal: Microeconomics 6.1 (2014): 154-181.
