My childhood play with dominoes was to line the pieces upright on their short end so that a tiny push to the end domino produced a cascade of falling dominoes until all were flat. The more dominoes one could line up, the better. Patterns could be made. The cascade could have tributaries causing two rows to fall simultaneously. Hours were spent carefully setting the dominoes on end, experimenting on twists and turns, and finally watching the whole row collapse.
Real estate is like dominoes, not the game, but the falling line. In all markets (buyer, seller, or balanced) the domino effect is discussed. The first domino might be Mr. Wanna Buy who has an offer on 234 My Street that is contingent on selling his house at 123 His Way. Ms. Canit Bee makes an offer on 123 His Way contingent on selling her house at 890 Next Line. Mr. and Mrs. Sublime make a non-contingent offer on 890 Next Line. The end of the domino line has been found. When Mr. and Mrs. Sublime close on their purchase the domino falls to Ms.Canit Bee to close on hers which allows Mr. Wanna Buy to close on the St. Paul house he wants to buy and on down the line. Sometimes the line is only two or three closings and sometimes it's more. It's actually a logistical nightmare in scheduling because most sellers want to close on their new house the same day they close on their old house.
In like manner when St. Paul buyers are skittish as they have been the last year, the dominoes fail to fall. Without that first purchase to start the line falling, they all remain standing!
The dominoes of real estate also affect other industries. If St. Paul home buyers don't buy, but choose to wait until the market gets better, the impact is felt in other industries as well. The title companies, mortgage companies, insurance agents, home improvement centers, handymen, lawn care specialists, factory workers, car dealers, car washes, painters, plumbers, etc. are all impacted by the domino effect of money not being spent. When title, mortgage, and insurance company employees are laid off, they no longer purchase goods and services from other industries. Without real estate sales, people working in St. Paul housing related fields (which are a massive number of industries) are impacted. Eventually those industries impact other goods and services and a full fledged recession is born . . . just because real estate buyers refused to push the first domino!
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