How more homeownership may lead to unemployment

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  • councilalumnus Provo, UT
    Nov. 9, 2013 6:31 p.m.

    I found the final statement of particular interest.
    "Oswald said the research may go some way to explaining why Spain, with a homeownership rate of 80 percent, has unemployment above 25 percent, whereas Switzerland, with a 30 percent ownership rate, has a jobless rate of just 3 percent."
    I believe this is a flawed argument. There are extreme cultural differences at play here.
    For example, a recent study on "honesty" dropped wallets with ID and money in major cities around the world. In the U.S., 8 of 12 were returned. In Spain only 2, and Portugal only 1. Also the economies of these two countries are radically different. While the rest of the article was thought provoking, the statement at the end was a big stretch. Taken to it's logical conclusion, one could predict 0% unemployment with 0% homeownership. There once was a place like that 70 years ago, and over the entrance was the phrase "Arbeit Macht Frei", or "Work Makes you Free".

  • KDave Moab, UT
    Nov. 7, 2013 8:50 a.m.

    So all the homeless folks have great jobs?

  • Brer Rabbit Spanish Fork, UT
    Nov. 6, 2013 1:37 p.m.

    Home ownership may be good for the community, but in my opinion adds to the unemployment problem. The reason is that often people cannot relocate to another area to take advantage of new employment opportunities. Home ownership then becomes a drag on employment opportunities. Renters can usually give their 30 day or less notice and leave. Home owners have to sell their home often at a loss in order to be able to afford to relocate. Since real estate values are stagnant, even selling at the original purchase price will cost about 7% in sales costs. For example a $200,000 home, sales costs will will be around $14,000.