Continued Job Growth Will Help Housing Industry

Homes sales are still weak and prices in many cities continue to fall. Overall, the housing market remains in the doldrums. But first-time buyers are returning, one signal that the worst may be over.

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STEVE INSKEEP, HOST:

Later this week, we get some key data to help judge the state of the nation's housing market. There are some early signs of recovery, but home prices are still falling in many areas, as NPR's Chris Arnold reports.

CHRIS ARNOLD, BYLINE: Tomorrow, we'll get the latest word on home prices from what's called the S&P Case-Shiller index. That keeps showing price declines in many areas. Though those price drops have been leveling off, so things definitely aren't as bad as they were.

CHRIS MAYER: The best news for housing has actually been the return of jobs and job growth to the economy.

ARNOLD: Chris Mayer is a housing economist at Columbia University's Business School. Over the past four months, the U.S. has gained on average more than 200,000 jobs per month. Many economists find that encouraging, although the last time we got the numbers, the job gains fell pretty sharply. That was the numbers for in March, according to the Labor Department. Mayer says a continued job growth is essential to getting the housing market back on its feet.

MAYER: To the extent that more people have jobs and more confidence in their economic situation, we're going to start to see people have the confidence to come into the market and buy houses.

ARNOLD: One thing that good be a good sign, first time home-buyers are making up a larger percentage of home sales. Also, home sales overall are above where they were a year ago. On the downside though, several million more foreclosures still threaten to push down home prices lower.

Chris Arnold, NPR News.

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