Does home building create jobs? That seems to be the premise of the National Association of Home Builders (NAHB), and they make a compelling case.
At a presentation in Idaho Falls, Dr. Elliot Eisenberg, a Senior Economist with NAHB, touted home building as a way to help create jobs. His argument was that when homes are being built, they impact so much more than just construction, but also people such as roofers and plumbers. And, of course with more disposable income, it creates more spending, which benefits other businesses.
This is keeping in line with what they presented to Congress back in October, when their chief economist, David Crowe, encouraged them to keep and expand the $8,000 tax credit, believing it would move the economy in a positive direction. At the time, Crowe was quoted as saying the tax credits would “generate $16.1 billion in wages and salaries; $12.1 billion in business income and tax income of $11.6 billion for federal, state and local governments.”
At the same time, Crowe encouraged Congress to help encourage regulators and the banking industry to restore lending for home building projects and eliminate unnecessary foreclosures.
It’s hard to argue against the premise stated by the NAHB, but it is also hard to ignore some of the numbers from around the country. In most places, home building is drastically limited by factors that have to do with job losses and falling home prices. Even though there’s fewer houses on the market because of the $8,000 tax credit, there are still a lot of houses out there to try to market. It seems almost suicidal to encourage Congress to push more home building until unemployment decreases, even though some jobs would be either created or stimulated by an increase in home building.
Of course, by now we all know Congress did extend the $8,000 tax credit and added an extra $6,500 for existing home buyers to upgrade, so it looks like the presentation was successful.
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Mitch Mitchell is a consultant who writes and participates in many different fields, including real estate finance issues. 
I can say for a fact that home building does create jobs here in Las Vegas. So many home builders here have stopped building, so there are a lot of construction workers looking for a job.
Chas@Las Vegas Real Estate´s last blog ..First Time Home Buyer Tax Credit Extended
Yes, home building create a lots of jobs, but it must be balance of building and requests, otherwise are you going to be sitting like us here in Spain with over 1 millions unsold properties who nobody is asking for. The banks and the Spanish Goverment are now sitting with them and have a new huge economic problem coming up and a very high unemployment, over 20%.
There’s no doubt that home building creates jobs, but it still doesn’t mean it’s a solution to our current problems. We still need much lower inventory before any building resumes and then it needs to be responsible and sustainable building!
It’s true that building may boost local economies, But you don’t want to create more of the same problem. – Houses that don’t sell or just rising inventories.
The recent announcement of the renovation tax credit will help. Perhaps they should have started out with a bigger tax credit of this sort and scaled back the new home credit. Maybe more plumbers and roofers would have switched to renovation work instead.
Who knows?
There’s no doubt that home building creates jobs, but it doesn’t mean it’s the right time to start building again. We still have a huge oversupply of homes (at least in Atlanta) that need to be sold first. When building does fully resume it needs to be more responsible and sustainable.