Purchasing a Home During a Financial Crisis - 825 Words

During this financial crisis various economic models on interest and inflation rates would be see buy a home as highly irrational, even for consumers who are wealthy. Despite its irrationality many people are still in purchasing or thinking of purchasing a home, and in order for economist to understand this economic action they must take into account the sociological aspects behind it as well. This is due to the idea of purchasing a house being more complex than the economic surface that is seen. There are many other more deeply embedded (and reliable) explanations as to why, especially in a time of total financial crisis, would anyone even explore the thought of purchasing a home. In the field of economical sociology there is a theory†¦show more content†¦This type of cognition is a more intimate type that looks at the environment of the individual and their own experiences in which they base their decision-making. In order to fully understand and interpret the decision-mak ing of an individual purchasing a home, we must take into account the alternative meanings that purchasing a home has. If there were someone who has lived in all other places except an actual house (apartment, hotels or the street), the idea of buy a home would represent a feeling of success and deliverance. Furthermore, associating the purchasing of a home with these two distinct strong feelings becomes so deeply embedded into the individual’s psyche that a borderline catastrophic decline in the real estate market would not come close to thwarting their decision to buy a home. This theory could successfully explain why professional athletes who came from modest backgrounds, purchases a home for either their mother (athletes from these modest backgrounds typically grew up in single-parent households) or family with their first big paycheck. This is done so often because buying a home is not only a great way to show mom you appreciate her, but it is also a representation of â €Å"making it† to the individual who grew up with â€Å"nothing†. Cognitive sociology is often described as the â€Å"middle-ground† of cognitive theory, it explores and implies the previous types of cognition and putsShow MoreRelatedThe Global Financial Crisis 0f 20081181 Words   |  5 Pages The Global Financial Crisis of 2008-2008: The Role of Greed, Fear, and Oligarchs The global financial crisis of 2008-2009 is considered to be worst financial crisis since the Great Depression of the 1930s. Large financial institutions collapsed, banks received bailouts by the government, and stock markets plummeted as well. In result, people were being denied loans. 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