Forex Flash: Economic recovery in Eurozone and US related to housing busts? – Goldman Sachs (Barcelona) - Housing busts have long-lasting macroeconomic consequences, including sluggish recoveries and persistently high rates of unemployment. According to the Economics Research Team at Goldman Sachs, “The subpar economic recovery in the US and the recurrent crises in the Euro area periphery are in some way related to the preceding housing busts, however a slower-moving dynamic linked to housing busts is also becoming apparent and may have important economic implications: the shifts in migration patterns that take place following housing busts.”

Our analysis suggests that housing busts are associated with significant falls in net migration rates, in the form of reduced inflows of people and, often, increased outflows. Moreover, migration rates remain meaningfully depressed for several years following a house price peak.