Housing to the rescue??
Will the depressed housing market be the driving force that motivates the Fed to finally drop interest rates? A recent report from Rosenberg Research suggests the housing market may be the sector that pulls the inflation rate down, thereby giving the Federal Reserve an opening to start reducing interest rates. According to the report, 10 of the 11 indicators that feed the housing market index are showing “significant declines over the last six months“. Interestingly enough, that 11th indicator is the Case-Shiller Home Price Index, which tracks home prices in 20 major metropolitan areas. It’s up 0.8% over the first half of this year.
And there’s the tariff angle, which Fed Chair Powell frequently cites as one of the main reasons for their wait and see approach, even in the face of seemingly weakening inflation and employment. The report suggests the housing price reductions Rosenberg is predicting over the coming year, could offset as much as half the inflationary impact of tariffs, reducing inflation well below the Fed’s target. But that all depends on the sellers of all this active inventory actually dropping their prices en masse. Stay tuned.
Did you hear? On September 6, Galveston will attempt to set a Guinness World Record title for longest walkway with our Seawall. Officials are hoping to get 8,125 people together to join hands between 61st and 23rd to honor the 8,000 victims of the 1900 storm and the 125 years since the storm that gave birth to our Seawall. Go to VisitGalveston.com for more details.