Recent data showing home prices experiencing their biggest year-over-year gain in more than six years could lead to a surge in relocation by job-seeking homeowners this year, according to a leading employment authority.
‘One factor that has kept unemployment rates high has been the inability of underwater homeowners to relocate for employment opportunities,’ says John A. Challenger, CEO of Chicago-based Challenger, Gray & Christmas Inc. ‘With home prices bouncing back, even those who may now simply break even on a home sale might consider moving to a region where jobs are more plentiful. This could spark a more rapid decline in the unemployment rate over the next year.’
According to Challenger, relocation is starting to increase among the job seekers going through the firm's employment transition programs. Last year, an average of 13.3% of those finding new positions each quarter relocated for the opportunity. That was up from an average of 11.7% in 2011. In 2009 and 2010, as the recession and housing market hit bottom, the relocation rate dropped to just 10%.
‘Increased mobility and churn in the housing market, of course, will help the economy in several ways,’ Challenger adds. ‘It could lead to an increase in the number of people leaving high unemployment regions for areas where job openings are going unfilled, thus getting more people back on payrolls. In addition, increased home buying will ignite more consumer spending on relocation-related services, new furniture and appliances, home improvement projects, etc. All of this activity will feed the economy and help create more jobs.’