With the American economy recovering from The Great Recession due in large part to a resurgent housing market, Standard & Poor's, the rating agency that downgraded the United States in August 2011, recently increased the credit rating again.  In raising the rating, Standard & Poor's noted the willingness of policymakers in the United States to work to sustain economic growth and the reduction in economic risks.

 Much of this has to due with the revitalized real estate sector in the United States.

About one-fifth of the US economy is tied to the housing market.  The impact is even greater overall, though.  When housing prices are high, Americans feel confident enough in their personal financial situation to spend again.  As about 70% of the gross domestic product in the United States is based on consumer spending, this is the most critical component of the American economy.

"This can be seen in more wanting to buy homes again," observed Jerry Cohen, President and Founder of EquityBuild, a real estate investment firm.  "During The Great Recession, fewer wanted to own.  They preferred to rent and avoid the commitment.  Now more and more want to buy real estate again, both for their home and for investment purposes," continued Cohen, who has been a principal in more than 2000 real estate transactions since 1984.

Cohen furthered that, "With the stock market starting to tumble, the real estate sector is becoming even more vital for the American economic recovery.  This was the story during The Great Recession: stock and bond prices fell, but rents in the United States actually rose.  Real estate investment is looking to be a much better play than the securities markets, based on the recent developments and the history of the asset classes.  I think Standard & Poor's knows that, too."

The rebounding US economy has attracted greater foreign investment into the real estate sector across the country.  As but just one example, Chicago is drawing a great deal of investing from foreign entities.  

                                                                                                                           -30-