Category Archives: Inflation

Home Prices Are Rising Faster Than You Think

Prices of existing single family homes, as measured by the S&P/Case-Shiller National Home Price index, are rising is single digit terms.  However, the price changes that matter – the real or inflation adjusted changes – may be higher than many suspect. Backing out inflation, as shown in the chart, gives real increases averaging 6.3% annually […]

U.S. Economic Forecast: The Terrible Twos

Recent data suggest the U.S. economy has rebounded fairly well from its contraction in the first quarter of the year, giving financial-market participants, as well as American businesses and consumers, reason to be somewhat optimistic. Job gains accelerated after a lull in March, and housing activity strengthened after a deep winter chill. Also, at long […]

Economic Update: Great Expectations

Economic Update: Still A Recovery. Still Slow

Q&A with David Blitzer from S&P Dow Jones Indices Webinar

In this video clip, David Blitzer, Managing Director and Chairman of the S&P Index Committee, addresses questions from the S&P Dow Jones Indices webinar pertaining to REITs and the entire housing sector of the U.S. economy. Questions include: How do housing prices today compare with another period of low inflation / low growth? How will […]

Prices Are Not the Issue

Looking at rent-buy comparisons and inflation adjusted home prices shows that prices are not the problem facing the housing market.  The rent-buy ratio is close to the average of the last 25 years.  Although  renting is gaining market share from home ownership, recent increases in apartment construction suggest that rents increases won’t be strong enough […]

Home Prices Corrected for Inflation at 2001 Levels

Take inflation out of home prices and we’re back to 2001 — ten years ago.  The chart shows the S&P/Case-Shiller 10-City Composite Index in nominal (or current dollar) terms along with the index deflated  by the Consumer Price Index.  Looking at the dashed orange lines near the lower right hand corner, one sees that prices […]

Behind the Prices

Two ways to look a bit deeper into homes prices are comparing renting to buying and looking at real or inflation adjusted prices.  The charts give pictures of both.   Taking inflation out of home prices doesn’t change the big picture very much — there was still a boom and a bust and there is nothing […]

Inflation Adjusted Home Prices

Among the recent comments were a couple of requests to publish an inflation adjusted version of home prices; the chart show the S&P/Case-Shiller 10 City index and the same index adjusted for inflation with the U.S. CPI.  The adjusted series was rebased to have the same value as original series in January, 1987.   The adjusted […]

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