Are you looking for both a job and a house? If so, you may have noticed some similarities. This article explains why the job and housing market look so similar.
If you’ve been paying attention to recent business news, then you’ve likely seen an upward trend in both the job and housing markets. Both have benefited from the release of the COVID-19 vaccine and various other changes throughout 2021.
You might wonder if there’s some kind of connection between the two, considering both have risen in recent months. Here’s what you need to know about the housing market and the job market, and why one might influence the other.
Housing Market Predictions
Throughout 2020, the housing market suffered as a result of the pandemic and stay-at-home orders.
With nowhere to go and people losing jobs, potential homeowners opted out of buying homes or moving out. There were also fewer sellers or renters willing to list their properties for strangers.
However, the lowered infection rates and the newly developed vaccines have changed things.
The housing market has boomed in the past year, only recently cooling down to more normal rates. Additionally, demographic data suggests that the higher demand will eventually exceed availability.
As a result, the prices of homes have also increased. While millennials have reached the age where they want to settle down, new difficulties with finances and the heightened prices of homes are keeping them from pulling the trigger.
Job Market Predictions
Any recent job market search will show you very similar trends to the housing market. Initially, the market saw a big crash as a result of increasing unemployment.
As time has moved on, an increasing number of industries have either found ways to cope with work-from-home arrangements or re-opened their doors. Businesses that were previously closed have opened back up and need to replace employees that have moved on.
Unemployment benefits have also expired for many people. Now, they need to head back to work to make money.
Federal Reserve Chair Jerome Powell now believes the labor market will continue to grow throughout the rest of the year.
The Real Estate Industry and the Job Market
The housing market is directly tied to the employment search. If people can’t find jobs, they can’t earn a solid paycheck. Without money, people tend to save what they have and avoid big purchases.
On a similar note, filling more industrial and construction roles leads to more houses being built. When there are more homes, the real estate industry is less likely to stagger.