US house prices predicted to rise 2x inflation and wages

  • An acute shortage of affordable homes in the U.S. will continue over the coming year, according to a majority of property market analysts polled by Reuters.
  • The shortage is driving prices up faster than inflation and wage growth.
  • Annual average earnings growth has remained below 3 percent even as house price rises have averaged more than 5 percent over the last few years.
    The latest poll of nearly 45 analysts taken May 16-June 5 showed the S&P/Case Shiller composite index of home prices in 20 cities is expected to gain a further 5.7 percent this year.That compared to predictions for average earnings growth of 2.8 percent and inflation of 2.5 percent 2018, according to a separate Reuters poll of economists.
  • U.S. house prices are then forecast to rise 4.3 percent next year and 3.6 percent in 2020.

Contrubuted by Bill Burke

President, Deo Adiuvante, Inc.

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