Saudi Press

Saudi Arabia and the world
Wednesday, Sep 17, 2025

US Likely to See Higher Inflation From Housing 'For a While', Fed Governor Says

US Likely to See Higher Inflation From Housing 'For a While', Fed Governor Says

The United States is likely to see greater inflation risks from record-high housing prices as demand continues to outstrip the number of newly-built homes while bottlenecks in supply chains slow construction, Federal Reserve Governor Michelle Bowman said on Monday.

“I anticipate that these housing supply issues are unlikely to reverse materially in the short term, which suggests that we are likely to see higher inflation from housing for a while,” Bowman said.

Sales of new single family houses in the United States jumped 14% in the month to September as buyers tried to beat a potential hike in interest and mortgage borrowing rates despite record high home prices, Commerce Department data showed.

The median selling price for existing-homes in the United States rose 17.8% in July from a year earlier to hit a record high of $359,900, according to the National Association of Realtors.

The S&P CoreLogic Case-Shiller US National Home Price Index said its 20-city indicator showed a 19.7% year-over-year gain in August, barely changed from the 20% reading in the previous month.

“Because housing costs are a large share of living expenses for most people, these increases are adding to current inflationary pressures in the economy,” Bowman said. “Indeed, we are already seeing sizable increases in rent and owners' equivalent rent in many parts of the country.”


The US economy shrank by 3.5% for all of 2020 due to shutdowns and other disruptions caused by the COVID-19 crisis. Growth this year has been spotty, with an annualized 3.5% expansion in the first quarter, 3.6% in the second and 2.0% in the third.

Besides uneven economic growth, the Federal Resrerve has faced three other problems. The first is inflation as wages and the prices of almost everything have soared from the lows of the coronavirus pandemic, especially pump prices of gasoline now at seven-year highs. The second is slower-than-expected employment growth, with at least 5 million of the about 21 million jobs lost last year not having returned due to conditions forced by the pandemic. The third is the continuous disruption in supply chains as the output of building materials and electronic components remains challenged.

“Before this past year, the pace of construction of new homes was below its long-run average for more than a decade," Bowman said. "The supply chain bottlenecks … are slowing down construction further. These issues affect the rental market too: The multifamily rental market is at historic levels of tightness, with over 95 percent occupancy in major markets.”


Dire housing shortages in the United States since the financial crisis of 2007-2008 and last year’s coronavirus outbreak have sent home prices to record highs.

Despite the grossly inflated market and a huge mismatch of demand versus supply, many buyers remain hopeful of locking in before the Federal Reserve raises interest rates sometime next year in what would be its first hike since the COVID-19 outbreak in March 2020.

Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Sam Altman sells the 'Wedding Estate' in Hawaii for 49 million dollars
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
Kuwait opens bidding for construction of three cities to ease housing crunch.
This Week in AI: Meta’s Superintelligence Push, xAI’s Ten Billion-Dollar Raise, Genesis AI’s Robotics Ambitions, Microsoft Restructuring, Amazon’s Million-Robot Milestone, and Google’s AlphaGenome Update
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
Could AI Nursing Robots Help Healthcare Staffing Shortages?
Turkish authorities seize leading broadcaster amid fraud and tax investigation
Qatari prime minister says Netanyahu ‘killed any hope’ for Israeli hostages
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Big Oil Slashes Jobs and Investments Amid Prolonged Low Crude Prices
Social Media Access Curtailed in Turkey After CHP Calls for Rallies Following Police Blockade of Istanbul Headquarters
Did the Houthis disrupt the internet in the Middle East? Submarine cables cut in the Red Sea
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Trump Administration Advances Plans to Rebrand Pentagon as Department of War Instead of the Fake Term Department of Defense
Tether Expands into Gold Sector with Profit-Driven Diversification
Trump’s New War – and the ‘Drug Tyrant’ Fearing Invasion: ‘1,200 Missiles Aimed at Us’
At the Parade in China: Laser Weapons, 'Eagle Strike,' and a Missile Capable of 'Striking Anywhere in the World'
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
Israeli Airstrike in Yemen Kills Houthi Prime Minister
After the Shock of Defeat, Iranians Yearn for Change
YouTube Altered Content by Artificial Intelligence – Without Permission
Iran Faces Escalating Water Crisis as Protests Spread
More Than Half a Million Evacuated as Typhoon Kajiki Heads for Vietnam
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Miles Worth Billions: How Airlines Generate Huge Profits
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
Beijing is moving into gold and other assets, diversifying away from the dollar
Cristiano Ronaldo Makes Surprise Stop at New Hong Kong Museum
Zelenskyy to Visit Washington after Trump–Putin Summit Yields No Agreement
High-Stakes Trump-Putin Summit on Ukraine Underway in Alaska
Iranian Protection Offers Chinese Vehicle Shipments a Cost Advantage over Japanese and Korean Makers
Saudi Arabia accelerates renewables to curb domestic oil use
Cristiano Ronaldo and Georgina Rodríguez announce engagement
Asia-Pacific dominates world’s busiest flight routes, with South Korea’s Jeju–Seoul corridor leading global rankings
Private Welsh island with 19th-century fort listed for sale at over £3 million
Sam Altman challenges Elon Musk with plans for Neuralink rival
Australia to Recognize the State of Palestine at UN Assembly
The Collapse of the Programmer Dream: AI Experts Now the Real High-Earners
Armenia and Azerbaijan to Sign US-Brokered Framework Agreement for Nakhchivan Corridor
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
Nine people have been hospitalized and dozens of salmonella cases have been reported after an outbreak of infections linked to certain brands of pistachios and pistachio-containing products, according to the Public Health Agency of Canada
Texas Residents Face Water Restrictions While AI Data Centers Consume Millions of Gallons
×