Over the past several months, the housing market has been rattled by elevated mortgage rates, persistent inflation, and mounting recession fears, and a wave of tech layoffs could create a new real estate roadblock. Some of the nation’s largest tech companies like Meta, Amazon, and Twitter are in the process of laying off tens of thousands of workers, and those significant job losses could cause a slowdown in buyer and renter demand, Realtor.com reports.
Prospective homebuyers are already struggling to afford historically high housing costs, and rising unemployment could sideline a growing number of house hunters. Still, housing experts say the labor market is strong, and though tech layoffs are on the rise right now, pronounced layoffs aren’t likely in the long term.
“As people experience or read about job losses, they get concerned. They will then pull back on their willingness to rent a new apartment or buy a home,” says Robert Dietz, chief economist of the National Association of Home Builders. “In an extreme case, somebody may have to get roommates or move in with family.”
“The job market remains very solid,” says Nadia Evangelou, director of real estate research at the National Association of Realtors. “The unemployment rate remains near record lows. We have two jobs for every unemployed person.”
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