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More jobs help the housing market get on its feet

While the housing market is still battling it's way back to recovery, job employment is gaining ground and continuing to increase, reported Capital Economics.

In December, 200,000 new jobs were created, which along with lower real estate prices and less restrictive underwriting might see some market increases to the residential housing sector.

We're already in a buyer's environment for housing, lowering mortgage rates and declining home prices. However, Capital Economics figures that an individual with a median salary can put a 20% down payment on a new, average mortgage and only be commiting 12.8% of their income towards housing.

However, individual income is still rather weak. Both nominal and disposable incomes remained the same during November according to Capital Economics. The savings rate also dropped from it's 5% level in summer to 3.5% for November.

And with tighter underwriting standards still a reality, the housing market doesn't necessarily have everything going it's way, but its still good news for the future.

More and more lenders are stepping up and offering a higher LTV loan, up to 80% from 2010's 75%. Capital Economics says all these factors are promoting a good market for first time home buyers.

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