This is a narration of our weekly Rent and Operating Trends Report.
Consumer inflation softened in June, drawing more calls for monetary easing from economists and market analysts. The Consumer Price Index fell 10 basis points in June compared to May, marking the first monthly decline in prices since early 2020. The annual inflation rate fell to 3.0%. On the heels of a weaker than expected employment report, the drop in prices has caught the eye of policy makers. While Fed Chair Jerome Powell did not say when rates would be cut, he indicated that a rate reduction is on the horizon. The Fed will meet at the end of this month and then again in September. I expect the Fed will wait until September for its first rate cut of this cycle.
Multifamily fundamentals declined across the board last week. Traffic, leasing, occupancy, net effective rent and revenue per available unit all declined on a week-over-week basis. With the spring leasing season behind us, most operating metrics will flatten for the next few weeks. However, if we continue to see growing deterioration in key indicators it may portend a weaker than expected second half of the year.
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