The media – especially CNN which was sporting a claim that home prices “jumped” a couple of hours ago (since removed) – is spinning like mad at the moment. You see, home prices rose a pitiful 0.5% over last year.
Unfortunately, inflation rose a good deal more. Something like 3.16% last year and better than 2.2% so far this year (and I think they are cooking the books on those numbers. Have you bought groceries lately?). That’s about 2.7% averaged (but probably considerably higher).
So, let me try to put this in a way that the 0bama media lap dogs can understand:
The home prices rose at a rate that is substantially less than the rate of inflation overall. The home price lost ground. It did not gain. This may be the reason the investors are pulling back from home buying.
They can actually do math.
Didn’t you know that the official inflation numbers don’t include food or gas prices anymore? They didn’t like how those were affecting inflation so they removed them from the index. Your grocery costs, now matter how much greater than this time last year (or last month, even) have no impact on the inflation number. Isn’t it wonderful to be able to control the measure of your own success?
Ah, how progressive.
Teh media are Barbie: Math is HARD.