Analyses viewing the housing sector of the US economy have recently begun to factor in rental prices as a gauge of inflation. The move away from buying houses as an investment has sunk the value of homes across the country, but rental prices have taken off as a byproduct of this shift in housing behavior.
The Federal Reserve’s policy of maintaining low interest rates through to mid-2012 is partially considered using housing data as a prime element of consumer spending, inflation and sentiment towards investing. But rental prices are only one aspect of home values and their soaring increase, in some areas almost doubling, are beginning to take a toll on consumers. If the issue is pushed further, movement may be seen on interest rates sooner than expected; but so far, analysts aren’t holding their breath.
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