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Friday, January 27, 2023
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Americans Feel the Pain of Higher Housing Costs

'The number one reason these surveyed Americans had to move in with family or get a roommate in 2022 was inflation... '

(The Center Square) Americans are feeling the pain of inflation, especially when it comes to housing.

U.S. News and World Report surveyed 2,000 adults who either had to move back in with their family or got a roommate or housemate because of the higher cost of living. They made that decision even though the majority reported they believe there is a stigma associated with moving back in with your parents.

According to the survey, 71% say cost-of-living increases “had a significant personal impact on them in 2022.”

In fact, 59% of those surveyed said inflation and higher housing costs “made them consider moving to another city.”

On top of that, 87% of those surveyed say they “know at least one person who had to move in with family or get a roommate in 2022 due to inflation costs.”

The Producer Price Index, one marker of inflation with new data released Wednesday, has risen more than 15% since President Joe Biden took office.

The Federal Reserve’s higher interest rates to combat that inflation have also made borrowing money to buy a home much more expensive.

The latest Consumer Price Index data showed that shelter costs rose 0.8% in December, contributing to a 7.5% increase in the last year.

“The number one reason these surveyed Americans had to move in with family or get a roommate in 2022 was inflation making it too difficult to cover day-to-day expenses like groceries and gas, followed by cost-of-living hikes making it too difficult to pay rent or mortgage payments,” said Kristen Mollica of 360 Reviews.

“These high costs have also impacted Americans’ future family plans; among respondents who indicated they’ve considered starting a family or continuing to add to their family in 2023, 74% admit they’re reconsidering growing their family specifically due to inflation and cost-of-living increases.”

Experts say the shelter index could get even worse and may not fully reflect how much more Americans are paying for housing.

“Shelter CPI is now playing catch up but still only shows a 14% increase since the start of 2020 versus a 20.9% increase in actual Rents & 40.9% increase in Home Prices (nationally),” said Charlie Bilello, Chief Market Strategist at Creative Planning, a financial management group. “Which means that we could see more increases in Shelter CPI to close some of that gap.”

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