All told, for everything other than housing, inflation was just 1.5 percent — low enough that if housing prices had grown at historical rates, the Fed could have declared victory. The outsize role of shelter inflation means that homeowners and renters whose leases haven’t changed are experiencing inflation very differently from those who were more exposed to rising housing costs. Indeed, rising housing costs are a double-edged sword, increasing the wealth of homeowners even as they punish many renters. Since the beginning of 2022, housing wealth has added over $2 trillion to homeowners’ balance sheets. Retirees, with rising housing wealth and protection from inflation through Social Security and Medicare, are more likely to fare better.

Source: Los Angeles Times March 14, 2024 11:23 UTC