Federal Reserve Chair Jerome Powell and his entire team should be cognizant of the fact that rents have been declining for many months. Despite this, Powell has been examining laggard data that persistently appears inflated.
The latest CoreLogic report adds to the mounting evidence of leading rental market indicators showing rent inflation has been cooling for the ninth consecutive month in January, as the yearly growth rate slid to the lowest point since 2021.
Single-family homes across the US experienced a 5.7% increase in value compared to the previous year. Each of the 20 major metropolitan regions monitored by CoreLogic saw annual rent growth in the single-digit range for the first time since the end of 2020.
Despite the high-frequency rent data from CoreLogic and other research firms indicating a clear deceleration, this slowdown has not yet been reflected in the Fed’s consumer-price data due to delays in the calculation process.
Back in September, when looking at various leading rental market indicators, we reported that “Manhattan Apartment Rents Finally “Plateau” After Red-Hot Summer” a trend reversal that was also observed at the national level as we observed in “Nationwide Rents Drop For First Time In Two Years.” With rents peaking in August, two months later, the rental drop accelerated, as we discussed in “Just Tumbled The Most On Record As Economy Craters.”
Last month we penned a note, “Apartment Rents Slide Across All US Cities Amid “Crush” Of New Supply,” but outlined the Fed’s shelter inflation data is well behind the curve (as usual).
The good news is that with a long delay, the coming supply of new apartments – especially in places where housing inventory remains unusually low to the benefit of home sellers – will give renters more choices, making it not only more difficult for landlords to hike rents at rates seen last year.
More From The Real Estate Guys…
- Sign up for The Real Estate Guys™ New Content Notifcations
- Check out all the great free info in our Special Reports library.
- Don’t miss an episode of The Real Estate Guys™ radio show. Subscribe on iTunes or Android or YouTube!
- Stay connected with The Real Estate Guys™ on Facebook, and our Feedback page.
The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training, and resources to help real estate investors succeed.
Broadcasting since 1997 with over 600 episodes on iTunes!
Love the show? Tell the world! When you promote the show, you help us attract more great guests for your listening pleasure!