August 2, 2024 | American’s #1 Financial Problem in One Chart

In April 2024, a record 41% of those surveyed claimed that the high cost of living/inflation was their #1 financial issue – up from the previous record highs of 35% in 2023 and 32% in 2022.

At 14%, the high cost of owning or renting a home was the 2nd largest financial issue.

Negative Effects on the U.S. Economy

The high cost of living is forcing U.S. consumers to cut back on their spending – which slows the economy and likely explains why the U.S. unemployment rate jumped to a three-year high of 4.3% in July.

The Fed to the Rescue?

The rise in unemployment from a five-decade low of 3.4% in April 2023 to now the highest level since September 2021 may all but guarantee a September interest rate cut from the Federal Reserve, with economists calling for a 50 basis point reduction in borrowing costs.

But don’t be surprised if home prices fall along with falling mortgage rates.   Happens all the time during housing market corrections.

Robert Campbell August 2nd, 2024

Posted In: The Campbell Real Estate Timing Letter

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