At face value, a rise in unemployment could never be a good thing …. but as the guys discuss this week, it’s a bit more nuanced than that.
For a start, last week’s rise in the unemployment rate wasn’t driven by job losses, but instead a larger increase in the pool of available workers. And a 4% unemployment rate is still very low anyway. Those are the ‘good’ things.
But on the flipside, could the smaller-than-expected rise in unemployment actually lead to another increase in the official cash rate? Increased employment supports the property market, but another OCR rise would be a potential headwind.
Meanwhile, this week’s episode also covers the latest CoreLogic Pain & Gain Report for Q4 2023, showing early signs of a turning point for property resale performance. Buyer Classification for January is also discussed, as well as the data for December showing that most people are choosing to fix their mortgages for shorter periods.
There was also good news in the form of the latest National Construction Pipeline Report, which suggested that the current slowdown in new dwelling consents (and future construction activity) isn’t likely to reach the depths of the post-GFC episode. That’s positive in terms of reducing the risk of housing supply shortages.
This week, look out for the latest CoreLogic Housing Affordability Report, REINZ January figures, December net migration, January rent prices, and Q4 DTI stats.
Our new, monthly article series for Trademe is also discussed, and can be seen here.
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