Real Rents Maintain Stability
In real terms (i.e., adjusted for inflation) residential rents remained relatively stable in April, according to the latest Consumer Price Index (CPI) data released by the Bureau of Labor Statistics. These data showed the overall price level increasing at a seasonally adjusted annual rate of 2.5%, somewhat lower than average for the past year. The rate of increase for the "core" CPI (which excludes food and energy) was lower than this.

In the current environment the core measure can be especially important, as the Federal Reserve tends to consider it when making decisions about cutting short-term interest rates. Meanwhile, the residential rent component of the CPI increased at a rate of 3.7%in April, just fast enough to cause the real rent index (which adjusts rent changes for overall inflation) to edge up very slightly from 108.8 to 108.9. The index has basically been marking time, coming in at either 108.8 or 108.9, since it first dipped below the 109.0 mark last November.

 
Based on seasonally adjusted Consumer Price Indices; U.S. Department of Labor, Bureau of Labor Statistics.The annual rates indicate what the percentage change would be if the current monthly rate were sustained over a 12-month period.The real rent index is the CPI for rent of primary residence divided by the CPI for all items and scaled so that January 1995 is 100. [ return to top ]