Housing vs. Jobs

I was scrolling through the internet and came across this report, I thought it was interesting. Check it out for yourself.




Some interesting terms used in this report.

  • Mortgage availability, (the ability to qualify for a loan)
  • Jobs market, (unemployment rate, and job creation)
  • Mortgage rate, (are we heading to 3.5%?)
  • Underwater mortgages, (people owing more on their home then what they can sell it for)
  • Distressed market, (foreclosures and clearing of bad debts)

All of these are interesting terms, and I think it draws some comfort and discomfort in the market. With the mortgage rates at historic lows you would expect more people to be jumping into the housing market, however the stipulations attached to getting a loan are becoming harder and harder to meet making mortgage availability difficult for an average home buyer or first time home buyer, (average home buyer being someone who has some experience, maybe looking to sell and buy again).


Jobs are important as well, but we saw a very strong first quarter this year, (about 200,000-240,000 jobs per month added). I personally believe that people will start to settle down with jobs they can make a career out of, or areas that they can call home. With this happening there will be added stability to the employment and the discussion will shift from job creation to job stability, (hopefully keeping an unemployment rate between 3.5-5%)


The final matter is underwater mortgages and distressed homes. This is one of the things I appreciate about¬†capitalism, the market will correct itself. There are people who gave loans when they shouldn’t have, and there are people who took loans when they shouldn’t have. This is certainly not an easy topic to talk about, but there are enormous lessons to be learned from all this and hopefully as a country we will learn and move forward. Venture capitalists will benefit the most from others mistakes, but I think they have put themselves in position to benefit through hard work, studying, and of course a little luck.


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