A Realtor's Take on March 2017 CPI

Blog Post Image
Real Estate

JUST NOTICED THE BUREAU OF LABOR STATS MARCH CPI - is down slightly in March -- for the first time since February 2016.  Energy prices, especially gasoline, went down and so did wireless phone prices.  Food prices were up a bit  (0.5%) and everything else was down.  

CPI Change Sep 16 to Mar 17

Why do we care about CPI?  Because it is a broad measure of prices and inflation, so we don't want to see any extremes and we want to keep an eye on the trend so we can make good financial decisions.

THE SHELTER INDEX portion of the CPI is also down for March -- but overall it is up for the past 12 months by 3.5%.  The Bureau calculates shelter as rent and not home ownership.  So for renters, they calculate the actual rent -- and for homeowners they calculate prices AS IF the homeowners were renting their homes.  

MY TAKE - I'm guessing that the Shelter Index has taken a downturn in 2 of the last 3 months because mortgage rates are low and more and more people are buying instead of renting!