Posts filed under “Real Estate”

Back Out Housing Adjustments, and Core CPI = 5.3%

Adjust this!

We visited the issue of  BLS "Owners Equivalent Rent" in CPI back in May (and several times since). But we never did the heavy lifting as to exactly what the magical core rate would be if we back out the misleading BLS adjustment

Kudos to Tim (themessthatgreenspanmade) for rolling up his sleeves and doing the hard work of actually calculating what the core rate would be without the absurdity of the BLS hedonic adjustments: We end up with a Core Rate of 5.3%


Put that in your Hedonic BLS Modelling pipe and smoke it . .  .

UPDATE:  OCTOBER 17, 2005 10:26 AM

I abuse the term Hedonics to refer to ANY adjustment to price based on a rationale of logic (or illogic), rather than the focus on actually price. 

It is technically more precise to say that the Owner’s equivalent rent is a decision made in the process of designing the BLS CPI model — and less a true Hedonic adjustment.

Antony Mueller of the Ludwig von Mises Institute has an excellent explanation of how BLS abuses Hedonics here.

Home Ownership Costs and Core Inflation

Category: Economy, Inflation, Real Estate

Chart of the Week: Bloomberg REIT Index

Category: Investing, Real Estate

Insolvency Epidemic

Category: Economy, Real Estate

Polling Homeowners (they do not have a clue)

Category: Economy, Real Estate

Manufacturing versus Real Estate

Category: Economy, Real Estate

Housing Market Gives Cooling Sign

Category: Economy, Financial Press, Real Estate

Global Investors Gobble Up Mortgage-Backed Securities

Category: Financial Press, Real Estate

Forbe’s: Awaiting Housing’s Big Chill

Category: Economy, Real Estate

Real Estate’s Wall of Worry

One of the odder aspects of the so-called housing bubble phenomenon is how so many pundits have been so self-confident in their declarations of bubbleosity. I find that somewhat ironic — the same people who missed the largest stock bubble in human history have now become expert in spotting bubbles. And they now are spotting…Read More

Category: Markets, Psychology, Real Estate

Read it here first: Real Estate Begins to Cool

Category: Financial Press, Real Estate