Weekly economic and housing market update
October 14, 2022
WEEKLY DATA SUMMARY:
- I’m George Ratiu, Head of Economics Research at Realtor.com.
- Autumn sets in as the seasons change and a tapestry of color accompanies the cooler temperatures. On the economic front, however, this week we have seen signs of continued warming. Two measures of inflation indicated that prices accelerated in September.
- The Producer Price Index, a measure of wholesale prices, rose for the first time in 3 months on rising costs for goods, energy and services. With OPEC agreeing to cut oil production, upward pressure on energy prices can be expected in the coming months.
- The trend was reflected in the closely watched consumer price index, which accelerated again in September, pushed up by prices for food, cars, energy, housing and services. Core inflation, which excludes food and energy, remained at its highest level in 40 years. The strength of inflation indicates a high pace for the rest of the year and underlines that the Federal Reserve will have to continue to act decisively in its monetary tightening.
- Meanwhile, initial jobless claims rose last week due to fallout from Hurricane Ian in Florida. The number of people already receiving benefits has also increased.
- The NFIB Small Business Index saw a slight improvement in September, for the third month in a row, as businesses expected higher sales volumes. However, persistent inflation and labor shortages continue to challenge small business owners.
- Inflation was also a headwind for September retail sales, which held steady as lower car and gasoline sales drove down the numbers. Households are still spending, however, with prices continuing to rise, the big question is, how much longer? This is a key consideration as we head into the winter holiday season.
- This week, mortgage rates also rebounded towards 7%, pushing the monthly mortgage payment for a median priced home 75% higher than last year and shelving a growing number of buyers.
- With fewer people buying homes, inventories are rising and homes are spending more time on the market, according to weekly data from Realtor.com. At the same time, price growth continues to moderate.
- With affordability a top priority for most people, it’s no surprise that Realtor.com’s latest report on the most in-demand markets finds less expensive cities in the Midwest and Northeast leading the way.
- In rental housing news, Realtor.com’s September analysis highlights a rebound in demand in coastal markets. The silver lining is that rent growth has slowed into single-digit territory from a year ago.
- Enjoy the week and be well! We’ll keep you posted on our website and Twitter feed, until next week’s update.
- You will find the details with our housing data for download at realtor.com/research. And follow us on Twitter for real-time updates.
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