Texas Real Estate Brokerage Sales Apprentice Education (SAE) Practice Exam

Which economic factor is closely monitored by real estate professionals to assess the market?

1. Unemployment rate

2. Gross domestic product

3. Consumer price index

4. Total number of transactions

The correct answer is: Gross domestic product

The gross domestic product (GDP) is a critical economic factor that real estate professionals closely monitor to assess the market. GDP reflects the overall economic health and performance of a country, indicating how much economic activity is happening within that country. A rising GDP generally suggests a growing economy, which can lead to increased consumer confidence, higher employment levels, and more disposable income—factors that can drive demand for real estate. In contrast, while the other options are important indicators, they serve different functions. The unemployment rate indicates the health of the job market and can influence people's ability to buy homes, but it is one aspect of the overall economic picture. The consumer price index measures inflation and can hint at purchasing power but does not directly correlate with real estate activity. The total number of transactions is a relevant metric for assessing market activity, but it is more reflective of past performance rather than an economic indicator that shapes future trends. Thus, GDP stands out as a comprehensive measure influencing real estate decisions and market assessments.