There is an interesting link between rises in housing values and growth in employment. SB Recruitment explores why Australian’s have seen this trend across the states, and some of the causes.
It is no surprise that people need stable jobs to pay mortgages and own homes – one usually relies on the other. While lower interest rates often encourage market purchasing, when the employment market is unstable people are less likely to purchase homes and for the economy to see a rise in the housing market.
As the job market grows people usually have higher levels of income and confidence, which positively benefits the community in a number of ways. This is turn can lead to a higher numbers of buyers and also renovators, and then pushing housing prices up. This was so clearly demonstrated in the mining boom in the early 2000’s. Job creation and wage growth outweighed interest rates and there was a significant increase in property prices in regional areas of Australia, such as Gladstone, Townsville and Mackay.
We can also see from the property booms in Melbourne and Sydney from 2015 where the employment market has followed suit, both Sydney and Melbourne have continued to produce the largest proportion of jobs. Regions nearest to these two cities have noticeably improved in terms of employment.
Many researchers have criticised the close relationship between increased job opportunities and the housing market. Data research analyst Cameron Kusher of CoreLogic RP Data states “low interest rates have been a key driver for recent growth in home values; however, growth in dwelling values has been narrowly based geographically whereas interest rates are the same across the country. Given this, there is clearly more to current housing conditions than low interest rates with employment the key driver,” Kusher said.
While there are any factors that influence employment levels, such as infrastructure, migration, economy and more, it is interesting to see the link between the 2 historically, and we wonder where will 2019 lead us? Some experts are predicting a bad year for home prices again which will likely affect the employment and career opportunities in several industries and sectors, notably real estate and retail sales.
Have you been affected by employment and housing rates and can you see the link between the two in your industry? Now is the time to review your recruitment and career strategy in line with current trends. SB can help you plan and strategise what’s next, and how to best tackle the future, whether you are looking to make a career change, or planning your workforce.