How Does it Affect Your Choices?
The real effect of the unemployment rate lies in how it impacts the economy.
If the rate’s low, you’ve found a location that’s in high demand.
Most of the population is in work, which means they’re more likely to be able to access financing.
Plus, they feel confident in their ability to make repayments, be it on a mortgage or for rent.
This increased demand can drive your property’s value up.
However, it has an even greater effect on rental yields.
Competition for rental properties rises, which means you can command higher rents and increase your yield.
In fact, an upward trend in rental prices is a key indicator that a location’s about to enter a boom period.
Couple that with a decline in vacancy rates and you have two key indicators of a strong economy.
In this case, demand’s catching up with supply and increasing the value equation all round.