The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: Tradelite who wrote (33005)	6/11/2005 3:59:03 AM
From: Haim R. Branisteanu	Read Replies (3) of 306849

If population growth is around 1% the US must generate at least 300 million x 0.62 jobs per year which works out around 160,000 jobs every month just to keep employment at the same level - the statistics do not confirm that - and even less the average wage increases adjusted to inflation which are negative - meaning that the new jobs created are more and more of ever lower paying type. On the other hand as house prices rise well above inflation even in non bubble markets the mortgage rates rise accordingly for the same type of loan and static interest rates - which in turn diminish free income and cashflow for the working family. If interest only purchases are added to the equation the prescription for hard times are already there but no one is paying attention. What US government statistics indicate is jobs do not match population growth and new housing exceeds 4 to 6 times population growth for several years After all demand of housing is driven by population growth which is adequately employed and can afford paying down the mortgage from income and not home price appreciation

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