My Real Estate Blog

Harvard study finds job growth key to housing recovery

Improved affordability for first-time buyers and government incentives led to increases in sales of existing homes last year, according to the State of the Nation’s Housing report released by the Joint Center for Housing Studies of Harvard University.  The study also found a record number of foreclosures continue to add pressure to the housing market and millions of homeowners.

Despite some positive signs early in the spring-buying season this year, housing continues to face significant challenges, according to the study.  “Many factors still are weighing heavily on the market,” said Nicolas P. Retsinas, director of the Center. “Elevated vacancy rates, record foreclosures, the expiration of the home buyer tax credit, and continued high unemployment all are causes for concern.”

“If history is a guide, what happens with jobs will matter the most to the strength of the housing rebound,” said Eric S. Belsky, executive director of the Joint Center for Housing Studies.  “Right now, economists expect the unemployment rate to stay high, but if employment growth surprises on the upside or downside, housing numbers could too.”

Reprinted from C.A.R.