California Unemployment Rate hits 12.5% in January
http://www.mercurynews.com/breaking-news/ci_14524392
Unfortunately we set a 30 year record in January 2010: more people are out of jobs than they have in 30 years up from 12.3% in December 2009, but there seems to be an upswing as 32,500 people gained employment in the same month. A mixed message.
Regardless of how we interpret the data, one thing is very clear: there is a direct correlation to reduction in home buying behavior and unemployment. Regardless of what people may say about homes being more affordable now than ever before, if there is no sense of security in employment front, there will be no home purchases!
So what does this mean? All this effort in providing tax credit incentives is great, but unless and until there is a concerted effort by the State and Federal Governments to tackle the issue of unemployment and more importantly, to improve this number, there will be no increase in home purchasing activity.
In fact, as long as more people are losing jobs, they will start or continue to fall behind in making their mortgage payments, which will increase the activities in the distressed properties market, which will result in home prices falling, which then will continue this drag on the economy as industries related to real estate continue to suffer and lay off more employees. Truly a vicious circle. Right now, 1 out of 6 home owners is behind in their mortgage payments.
So we all should pressure our politicians in D.C. to stop playing politics and get at the job for which they were elected: improve the economy by creating more jobs. Everything else is secondary.
