Real Rents Rise for Second Consecutive Month
The real rent index continued to recover in June, according to the most recent Consumer Price Index (CPI) numbers released by the Bureau of Labor Statistics. While the residential rent component of the CPI increased at a seasonally adjusted annual rate of 3.4% (well in line with its average performance over the past year), the overall CPI remained perfectly flat.
Although prices on most items crept up during the month, on a seasonally adjusted basis this was perfectly offset by energy prices, which declined for the second month in a row. As usual, the movement in energy prices was driven by a large change in prices for petroleum-based products.
The bottom line is a real rent index (which adjusts residential rents for inflation) that moved up from 107.5 to 107.8. This constitutes a substantial increase for the second consecutive month, but the index had reached 108.0 in January, and was as high as 108.3 in late 2003.
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