High-income job losses are cooling housing demand
Recorded: Dec. 2, 2025, 3:04 a.m.
| Original | Summarized |
Metro Job Growth & Housing Demand: 2026 Economic Snapshot
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High-income job losses are cooling housing demand Which local economies sustain housing? We analyze Charlotte’s job boom vs. Austin/Denver slowdowns. High-wage contractions impact for-sale demand. Published: November 12, 2025 Read More > Search ... Results See all results
RESOURCES National Housing Market OutlookBuild-to-RentHomebuildingSingle-Family Rental High-income job losses are cooling housing demand
John Macke
November 12, 2025
Key takeaways Most metros are adding jobs more slowly than normal. Charlotte leads in job growth among major metros, while Austin and Denver fall far short of their historically strong pace.High-income sectors are contracting, while Education and Healthcare are expanding faster than normal across most metros.Employment composition matters as much as total growth for local housing market strength. Metros reliant on lower-wage job growth are likely to face softer for-sale demand. National job growth is slowing, but metro trends vary The national labor market is softening, with implications for local housing markets. Most major metros are adding jobs more slowly than normal. We analyzed employment performance by metro and industry, comparing today’s growth to long-term trends since 2010. Red represents job losses, yellow shows slower-than-normal growth, and green represents faster-than-normal growth.
High-income job losses will reshape housing demand The job market drives housing demand, but the type of jobs created or lost impacts the type of housing. High-income sectors—Information, Professional Services, and Financial Activities—are shrinking across most major metros. Workers in these industries drive for-sale housing demand more than rental demand. Nationally, high-income sector employment remained flat YOY in August, well below its long-term compound annual growth of +1.6%.The Education and Healthcare sectors account for the bulk of new jobs added in most metros and are growing faster than normal in almost every market. Many of these jobs pay lower wages on average and often generate rental demand more than homebuying activity. Nationally, education and healthcare employment rose +3.3% YOY in August, well above its long-term compound annual growth of +2.1% What’s happening in key metros Philadelphia (+1.8% YOY) and New York (+1.7% YOY) show stronger job growth than their historical trends (+1.1% and +1.6%, respectively). However, this improvement reflects recovery from weak post-Great Financial Crisis baselines rather than genuine outperformance.Charlotte (+2.6% YOY) is a standout performer, maintaining robust job growth supported by Professional Services expansion (+4.5% YOY)—a rare bright spot for for-sale demand.Austin (+0.8% YOY) and Denver (+0.0% YOY) are growing much more slowly than their historically strong employment trends (+3.8% and +2.3%, respectively). Tech and Professional Services jobs are declining in both markets, and even healthcare—which is expanding faster than normal in most metros—shows weak growth here. This reduction in high-paying jobs is weakening demand for both home purchases and rentals.The Bay Area continues to lose jobs across high-income sectors (-0.4% YOY), driving modest overall employment declines. These job losses have slowed compared to a year ago but remain negative YOY. Despite generating substantial spending and wealth, the AI-driven tech boom hasn’t added meaningful employment to the region. What this means for your business Whether you build, invest, or advise in housing markets, these employment shifts will impact your growth opportunities in 2026 and beyond:Homebuilders: Expect fewer qualified buyers. Position products at attainable price points and reconsider location strategies.Rental operators: Prepare for sustained demand from renters employed in healthcare and education.Residential building products: Anticipate margin pressure as affordability challenges push builders toward smaller, cost-efficient designs. How to stay ahead Our Metro and Regional Housing research package includes analysis of the latest demand, supply, and affordability fundamentals for each metro and region as well as results from our proprietary surveys. Our consulting team continually evaluates market feasibility, absorption/pricing/product recommendations, and overall investment/expansion strategy in markets nationwide. Combining these two areas of expertise yields qualitative and quantitative insight for more intelligent decision-making.
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John Macke Research Manager, For Sale John leads JBREC’s Southern California market coverage for the Metro Analysis and Forecast reports, produces the Regional Analysis and Forecast and Homebuilder Analysis and Forecast reports, and assists with coverage of the public homebuilder space. View Bio View Bio
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John Burns Research and Consulting’s latest analysis, published in November 2025, paints a complex and evolving picture of the US housing market, particularly as it pertains to 2026. The report’s core finding centers on a divergence in metropolitan economic trends, driven primarily by shifts in high-income job growth. While national job growth is slowing, several metros—particularly Charlotte—are exhibiting robust growth supported by Professional Services expansion, contrasting sharply with a slowdown in established markets like Austin and Denver. Furthermore, the contraction of high-income sectors—Information, Professional Services, and Financial Activities—across most major metros is reshaping demand, leading to a clear distinction between for-sale and rental market dynamics. The report emphasizes that employment composition matters more than total job growth when assessing local housing market strength. Metros reliant on lower-wage job growth are experiencing softer for-sale demand, while those with expansion in sectors like healthcare and education—often characterized by lower-wage jobs—are fueling rental demand. The data reveals a significant difference between Charlotte's strong performance, driven by Professional Services expansion, and the challenges faced by once-dominant markets like Austin and Denver, where tech and professional services jobs are declining. The Bay Area continues to experience negative employment trends within high-income sectors, despite significant wealth generation. Crucially, the report highlights the implications of these shifts for businesses operating in the housing sector. Homebuilders are expected to face fewer qualified buyers, necessitating a strategic adjustment towards more attainable price points and a reassessment of location strategies. Rental operators, conversely, are positioned to benefit from sustained demand fueled by workers in healthcare and education. The report’s analysis of building products indicates potential margin pressure as affordability challenges push builders towards smaller, more cost-efficient designs. John Burns Research and Consulting provides a detailed ‘Metro and Regional Housing Package’ offering nuanced insights into each market, underpinned by proprietary surveys and extensive data analysis. The consultancy also offers a ‘Consulting Services’ engagement for clients seeking strategic guidance, covering aspects such as feasibility assessments, absorption/pricing recommendations, and investment/expansion strategies. To stay ahead of these evolving trends, clients can subscribe to the ‘Research Memberships’ which include access to interactive dashboards and research. Moreover, the team constantly evaluates market feasibility and provides actionable insights, combining quantitative and qualitative data to inform informed decision-making. |