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In June, shelter prices rose 0.2%, their lowest monthly jump in nearly three years, according to the consumer price index. But a jump is a jump, and overall, you could say the price of shelter has been hopping. Up 5.2% over 12 months, it's a big factor keeping inflation from reaching the Federal Reserve's target of 2% annually.
In a pie chart of your household expenses, shelter costs — that's rent or what it costs to live in your home — likely take up a big ol' chunk. It's reflected in federal data.
Shelter accounts for about a third of the CPI.
One reason shelter inflation has stayed high in the past couple of years is that many young adults want their own space, said Jessica Lautz, deputy chief economist with the National Association of Realtors®.
"There are a lot of people who don't want to double up anymore," she said.
In many cases, [kids] double up with their parents, which Lautz said happened a lot during the pandemic.
Now, these grown-up kids are competing in a housing market where inventory is low, partly because lots of older people are staying put. "It's putting pressure on both the rental market and homes for purchase," she said.