For first time new home buyers, the federal government is offering an 8000 tax credit and the state of California a 10000 tax credit – which is an amazing opportunity and incentive for people to buy their first home.
The problem is that many of the typical first time home buyers (age 20-30) are having a tough time finding a job in California. Unemployment in California is currently hovering around 11 percent and that number is expected to creep up through the end of 2009.
From the LA Times:
Although the often volatile unemployment rate dropped to 11% from March’s 11.2%, the Golden State still lost 63,700 jobs during the month. The number of people seeking work has swelled by 842,800 from a year ago, the state Employment Development Department reported Friday.
Economists predict that jobs will continue to disappear for at least the rest of the year. “The unemployment rate will creep up,” said Esmael Adibi, an economist at Chapman University in Orange. “During the summer months, there is a jump in the labor force mainly because of new college graduates or students seeking temporary positions. Clearly, there would not be that many jobs.”
The grim job market — the worst in almost half a century — has put a damper on the graduation season celebrations of students such as UCLA English major Rachel Beezy.“I’m doing my very best to stay optimistic, but I’m in the same boat as everyone else,” Beezy said. “It’s a horrible time to graduate.”
Before the recession sank its claws in her dreams, the 28-year-old Van Nuys resident hoped to make a career in film production.
So far, she’s sent out 20 resumes without getting a concrete response.
Now, Beezy said, she’d be willing to go back to the retail management job she held before college. Even a $10-an-hour internship would sound attractive.
Campus career center directors and recruiters agree that they’ve never seen competition as tough as it is this spring.“It’s unprecedented. We see fewer and fewer firms coming to hire graduating students,” said Gary Greener, associate dean for career services at Southwestern School of Law in Los Angeles.
In a normal year about 600 employers come to interview juniors and seniors at USC, said Eileen Kohan, who runs the Career Planning and Placement Center, but recruiting efforts are down about 30%.
“Every firm that has laid off people in the past year didn’t come,” she said. “It’s been an incredibly difficult year.”
State data bear out Kohan’s observations. In March, nearly one in seven job seekers between the ages of 20 and 24 — many of whom are high school and college graduates — were unemployed.
That’s up 40% from a year earlier, and unemployment among people of all ages with bachelor’s or advanced degrees increased by 50%.
The outlook is even worse for teenagers graduating with high school or general educational development diplomas. Unemployment among 16- to 19-year-olds hit 26.2% in March, up from 18.7% a year earlier.
While it is a great time to be a first time home buyer because of the California 8000 tax credit, the 10000 California tax credit and the soon to be announced FHA bridge loan program, it is only a good time to buy a home if you have a job.
And jobs aren’t as plentiful in California as they have been in recent years.
