housing market stock market relationship?

  • Thread starter garretokelly
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garretokelly

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Would anyone like to suggest how house market performance and local stock market performance are related to each other (if at all)? I'm just curious to know if there are 'causes and effects' between the two.

If the house market increases then construction stocks and mortgage lending stocks also increase. Do non housing related stocks drop in price because they're starved of investors? ie people 'dump' their XYZs to get into property?

If the housing market subesequently slows down, do property investors try shift their money out of property back into non-housing stocks thus causing a swing? Or does a housing slow down also depress the stock market generally (both housing and non-housing related stocks)?

A lot of the average public have invested in property over the last while, do you think they would invest in stocks as readily?

Maybe you'd distinguish between the amateur/inexperienced investors and the savvy/professional investors when anwering.

Thanks
 
I'm in the amateur class but I would think that in the broadest sense both would track the general performance of the economy.
 
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