The Daily Money: Disconnect between current rents and shelter inflation data
Happy Hump Day, dear The Daily Money readers.
If you breathed a sigh of relief at the news of recent rent price drops, you might have been surprised by yesterday’s CPI report numbers on the increasing cost of shelter as the biggest contributor to inflation.
The overall shelter costs were up 8% from a year ago and rent inflation stood at 8.7%, according to the Consumer Price Index report, which also shows that annual increase in inflation has fallen for the 11th straight month and is now at the lowest level in more than two years.
Even more perplexing: Nationwide, rents declined 1% from a year earlier in May−the largest drop since 2020−as a building boom increased supply and economic uncertainty cooled demand, according to Redfin.
One reason for the disconnect: The way in which the Bureau of Labor Statistics collects its data.
The CPI program collects rent data from each rental unit every six months since rents are locked in place for a given lease term. It also allows for a larger sample, according to the BLS.
However, in a fast changing, volatile housing market, that measure can seem outdated compared to private indexes that look at current leases.
“At the beginning of this year, landlords were beginning to drop rents. And that means that leases that are coming online now in June, for example, would reflect those lower rents. If rents indeed are coming down in a systematic way, we should see that reflected in the CPI as we head through the summer,” says Bright MLS Economist Lisa Sturtevant.
Undocumented women are among the lowest paid
Undocumented women workers earn less than women overall and less than undocumented men, making them one of the lowest paid groups in the U.S., according to a new report.
But how low the wages are depends on where they live and the type of jobs they have, according to a new report by the Gender Equity Policy Institute (GEPI).
The study’s most surprising finding, according to author Natalia Vega Varela, was that such gender pay gaps vary enormously between California, New York, Florida and Texas, the states with the largest populations of undocumented women. Supportive policies in California and New York may have raised pay for undocumented women in those states, she said.
New York emerges as the state paying the highest wages among states that employ them the most. Undocumented women make $22,000 more than in Texas and $21,000 more per year than in Florida, according to the report. Undocumented women in New York make $11,000 more than their counterparts in California.
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Each weekday, The Daily Money delivers the best consumer news from Paste BN. We break down financial news and provide the TLDR version: how decisions by the Federal Reserve, government and companies impact you.