In the post-election analyses of What It All Means for the country’s future, economic trend watchers are keeping a close eye on the future of the recovering – but still struggling—US housing market. Based on existing conditions and expectations for the coming years, the health of the housing industry may be tied to an improving employment picture and a robust mortgage industry.

Underlying many of the concerns about the economy overall is the issue of employment. Fewer jobs and lower wages affect every aspect of a consumer society. Now, however, job growth is improving in many areas of the country, with a corresponding positive effect on the housing markets in those areas.

Improved employment opportunities and better wages usually mean more new housing construction, and also more purchases of existing homes. Since a major barrier to home purchasing has historically been lack of a stable or well-paying job, as well as corresponding poor credit, the uptick in job growth can mean more potential buyers able to make down payments or qualify for mortgages.

The rental market, too, benefits from job growth. New development in industries and other kinds of businesses can mean an influx of workers needing housing, and better wages can mean

a corresponding bump in rental rates in those areas. And because many of those wage-earners may not end up buying houses, and remain long-term renters instead, that creates opportunities for investors purchasing rental properties as well.

The health of the mortgage industry is a cornerstone of this continued growth. The dysfunctions that led to the issuing of too many subprime loans and the resulting collapse of US housing markets across the country have been addressed in some key ways. Thanks to continued Federal subsidies, mortgage rates remain low, and lenders, starting with the federal mortgage agencies Fannie Mae and Freddie Mac, are making efforts to work with distressed homeowners to prevent another foreclosure meltdown.

Along with attempts to help homeowners sinking under the weight of mortgage payments, lenders across the country are tightening qualifying standards for home loans of all kinds in an effort to repair the damage of the careless lending practices that put many home purchasers in over their heads a few years ago. According to industry watchers, these moves should reduce the record high rates of foreclosures, short sales and legal actions that followed from the 2008-2011 housing crisis.

In a global economy, events half a world away can have a profound effect on conditions at home, and financial experts are keeping a cautious eye on the behavior of international bond markets and real estate investing as well. Likewise, unexpected disasters such as the recent Hurricane Sandy can alter the financial landscape in a virtual heartbeat, plunging whole areas of the country into a chaos of unemployment and housing crisis.

Still, with continuity in Washington, improvements in the employment picture and a responsibly functioning mortgage industry, financial experts expect that the US housing market as a whole may continue its upward trend, with increased opportunities for investors applying Jason Hartman’s strategies for building wealth through income property investments.

The American Monetary Association