The annual State of the Nation’s Housing report from Harvard University’s Joint Center for Housing Studies says the strength of the housing recovery will depend on job growth. High unemployment and declining household incomes feed the foreclosure crisis, which pulls prices and consumer confidence down, leading to sluggish sales and a slow recovery. Eric Belsky, the executive director of the center, said an improved labor market, paired with historically low interest rates, could soften the expected drop in sales following the expiration of the tax credit. The unemployment rate fell to 9.7 percent in May, down from 9.9 percent in April. According to a Bloomberg poll, economists estimate unemployment will average 9.6 percent in 2010. More here and here.