At the end of August, the government updated its economic numbers for the U.S. economy’s performance in the April-June quarter. The update confirmed what it had reported last month: That the economy shrank for two straight quarters. 

Six months of economic contraction is a widely held but informal definition of a recession. The post-pandemic era very well may be rewriting the definition of a recession. Inflation has been raging, wages are growing, employment is up, and unemployment is at a 50-year low. None of those are indicators of a recession. The six-month decline in economic output is the only strong indicator of a recession. So, are we in one or not?

More likely, the post-pandemic economy and major shift of economic power to Millennials are reshaping the economy. Inflation is still so high that despite pay raises, most Americans’ purchasing power is eroding. Most people feel inflation in their day-to-day purchases – essentials like food, gas, and rent. 

Make no mistake about it, the Federal Reserve is at war with inflation. There have been four consecutive interest rate hikes that have pushed borrowing costs to the highest level since 2019. This is boosting consumer borrowing costs for items more associated with a recession – homes, cars, and credit card purchases. What we are experiencing is purchasing power erosion on two economic fronts – short-term and long-term purchases. This is key to why many economists are saying we are not currently in a recession (even with six months of economic decline), but we are headed for a recession later this year or in 2023. After inflation has been tamed but long-term spending remains in decline.

We often don’t know when we are in the early months of a recession. Six months decline is unofficial. Recessions are officially declared by the obscure National Bureau of Economic Research, a group of economists whose Business Cycle Dating Committee defines a recession as “a significant decline in economic activity that is spread across the economy and lasts more than a few months.” All of their data is hindsight. None of it is forward-looking. They use many data points to define a recession with major indicators being gauges of income, employment, inflation-adjusted spending, retail sales, and factory output. It puts heavy weight on jobs and a gauge of inflation-adjusted income that excludes government support payments like Social Security. Ultimately, the NBER typically doesn’t declare a recession until well after one has begun, sometimes for up to a year.

Ask Brian is a weekly column by Real Estate Expert Brian Kline. If you have questions on real estate investing, DIY, home buying/selling, or other housing inquiries please email your questions to [email protected].

Question from Carter in OK: Hi Brian, I bought my home 14 months ago. This is the first home that I’ve owned a home that is part of a Home Owner’s Association. Last week, I received a certified letter from the HOA saying that they are beginning foreclosure against a lien they have placed on my home. They say that I haven’t made any of my “assessment” payments since I moved in. I’m totally confused. I thought those payments were part of my mortgage payment the same way my homeowner’s insurance was with the house that I owned before this one. How do I fight my homeowner’s association? They’re telling me my account is with the lawyers. I didn’t get a bill and suddenly, there’s a lawyer’s letter informing me that my HOA is foreclosing on the lien to my house for nonpayment of association fees.

Answer: Hello Carter. Without knowing all of the details, it does sound like you have a big problem on your hands that you need to start resolving immediately. The fact is that in most states, HOAs have almost as much authority to foreclose on your house as your mortgage company does. The number one reason for foreclosures is the non-payment of HOA fees. If you really don’t understand what is going on, you should probably hire an attorney to help you understand and to help you figure out what your options are and what your next step should be.

I can understand how you might have thought it was part of your mortgage payment in the beginning but there had to have been a lot of red flags telling you otherwise – beginning with when you bought the house. HOA laws vary significantly from state to state, and I don’t even begin to understand all of the variations. However, some general laws apply in almost every situation. First of all, there should have been a pile of paperwork related to the HOA that was part of the closing paperwork that you signed at the closing table. I’m guessing you didn’t read it or didn’t understand it. That’s unfortunate. When I’ve written about HOAs in the past, I’ve always strongly suggested home buyers understand what is going on with the HOA even before making a purchase offer. This includes reading the board of directors’ meeting minutes for the past year, going over the financial condition of the HOA, and reading the Covenants, Conditions, and Restrictions (CC&Rs).

Carter, back to your specific problem. The short answer is that “yes” you have a big problem because almost every HOA has the authority to foreclose on a home owner for failing to pay dues or fees. Depending on state laws and the CC&Rs, you should have been sent multiple notices by registered mail telling you that you were past due. Eventually, you should have received notice that the HOA was beginning the process to place a lien on your home. It definitely should have opened your eyes when you received notice that a lien had been placed on your home. Maybe that is the step that you are currently at, and it did catch your attention. A letter from the HOA (or their attorney) might have included a notice of intent to foreclosure and that is the next and final step. This is what you need an attorney to help you understand — what step in the process you are at and what you need to do to turn things around. You can be sure that you’ll have to pay all of the past due fees and probably a bunch of late payments and fines along with it. 

Working as a real estate professional often means spending long hours at your desk, working hard on client problems. Sitting down for that long while working on marketing plans, making and answering client calls, and doing related work on your computer is sure to take a toll on your body. Therefore, it’s recommended to invest in a high-quality ergonomic office chair to support your comfort and health.

Many real estate professionals know the value of investing in an ergonomic chair. The X-HMT heat and massage chair from X-Chair is an industry favorite due to its design capabilities. Making this your ergonomic office chair of choice is often a good idea. However, you won’t be able to get the most out of your X-HMT unless you know how to use it properly. Here’s what you should know.

The heat and massage capabilities of your X-HMT are great for providing comfort and relief from back pain, but the unit that controls those functions needs to be configured properly for it to be as effective as possible. After you’ve installed the unit, you will need to turn it on and allow it to run on its initial battery charge until it’s completely depleted. 

Then, you must charge the battery to at least 75 percent to ensure that the battery is conditioned properly. This will extend the battery’s life, making the unit able to hold a charge for longer. Fully charging your battery takes approximately four to five hours. You can use your unit while it’s plugged in, or you can let it run on battery power exclusively.