It’s a pretty simple equation. The more people with jobs there are, the more people there will be making money. The more people that are making money, the more people there will be saving up to eventually buy a house. But, like most things in life, it is never that simple.
First, here is the good news; February saw a stronger than expected gain in the employment report. However, employment might have grown in February, but wages did not. In fact, wage growth was lower than expected in February and trailed far behind home price appreciation.
While more people might be entering the workforce, it is increasing the demand for housing, but not the affordability. This is especially bad news considering that large home value increases are fueled not by increased wages, but by a lack of supply that already exists in most markets across the U.S., CNBC reports.