An estimated 25 million borrowers will owe more than their house is worth by 2011.

Source: CNNMoney.com

Date: 8/06/2009

Keys: Marketing, pricing, consumer behavior, economy, government

Link:  http://money.cnn.com/2009/08/06/real_estate/underwaterworld/index.htm?postversion=2009080615

Questions for discussion:

• Research suggests that the current and expected value of a home influences the homeowner’s attitude towards spending. Explain why this would be true.
• How do you think the conditions described in the article will influence the general buying behaviour of individual homeowners as well as potential future homeowners? Explain your thinking.