According to Jinshi Data, Seeking Alpha analyst Damir Tokic said that the annual housing inflation rate in the United States is still above 5%, and housing inflation is an important part of the CPI. Housing inflation rose 0.4% in July, higher than 0.2% in June. The Federal Reserve hopes that the figure for August will be 0.2%.
The key argument for expecting prices to stabilize is that rents will fall, especially for new tenants of the same rental units as estimated by the New Tenants Index, which fell by 1.1% in Q2 2024.
As falling rents start to be reflected in official CPI data, we may soon be facing a deflationary shock.
