Part 4/13:
The United States offers a keen glimpse into the international scenario, serving as a bellwether for other markets. The impact of rising interest rates and inflation is vividly evident here, providing insight into future trends.
Inflation and Housing Costs
The Consumer Price Index (CPI), a lagging indicator, is influenced heavily by shelter costs, which tend to trail actual housing market movements by 12-18 months.
Recent data shows a rapid decline in rent increases, with observed increases falling sharply, signaling an approaching equilibrium that could temper inflation further.
Despite rents increasing by 7.5% YoY in September, they are off their peaks earlier in the year, indicating a cooling demand.