Improving employment situation could benefit California housing market
May 9 2013 2:07PM
With the employment situation improving and mortgage rates hovering around all-time lows, houses for sale in Los Angeles could fly off the market in the near future.
According to the U.S. Department of Labor, initial jobless claims fell to a five-year low in the week ending May 4, as applications for unemployment insurance payments declined 4,000 to 323,000. Economists surveyed by Bloomberg predicted a marked rise for the week to 335,000 claims.
"There is only so much companies can cut layoffs before they have to start thinking about adding to head counts," Guy Berger, economist at RBS Securities, told Bloomberg. "The longer this continues, the more likely companies will have to add to head counts."
Another positive sign for the employment situation was the 165,000 jobs added to the economy in April, which brought down the unemployment rate to 7.5 percent.
In March, around 20,000 new and resale houses and condos were sold in Southern California, according to DataQuick, a total that could rise markedly in the coming months if the employment situation continues to show signs of life.
Should conditions remain favorable for buyers, there could be high demand for properties in West Los Angeles.
