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December 4th, 2009 10:41 AM by David W. Welch
Your economics lesson for the day is a simple straightforward relationship - jobs equals rooftops. The employment report came out this morning and the expectation was that 130,000 jobs would be reported lost in November, but the actual number was only 11,000 the better news was that the unemployment rate actually went down a couple of ticks to 10%. It may not be time to start celebrating, but it is close. I posted in my blog a few weeks ago that two different people I know that work for two different boat manufacturers in Orlando said that people were being called back to work. In my opinion pleasure boats are probably one of the more discretionary purchases anyone makes. When these types of jobs start coming back, it is just a matter of time before we start seeing some very positive employment numbers.
I think an even more visible effect of the improvement in the job situation will be automobile purchases. Car sales have been in the dumps for quite a while now, and I suspect there are a lot of people just waiting for their employment picture to improve to make a new car purchase. When car sales pick up, look out for improvement in several other areas. Just like the downward spiral we saw as the market dived into the recession we will see an upward trend that feeds more positive results. As the employment situation improves, people will begin to purchase homes at a more brisk pace absorbing the current inventory. As the inventory begins to go down, prices will begin to rise. At some point, new home builders will begin to see increased sales. They will need to step up production leading to improvements in construction employment. I think we will be seeing some real improvements by the end of the first quarter of 2010.
Orlando Real Estate, David Welch Real Estate Optimist, As Seen on HGTV's House Hunters