After posting their 39th consecutive month of year-over-year price gains, home prices in 33 states and the District of Columbia are at or within 10 percent of record highs, according to a report issued today by CoreLogic.
Home prices increased 6.3 percent year-over-year in May, and 1.7 percent month-over-month. Relatively low mortgage rates have helped fuel the price gains. In cities like San Francisco, where there is limited supply and high demand, prices are growing at a double-digit clip.
Prices are so high in certain areas that some economists are starting to worry about localized bubbles. The number of homes on the market is increasing slightly. Total housing inventory at the end of may reached 2.29 million houses, 1.8 percent more than this time last year, according to the National Association of Realtors. That’s a 5.1-month supply, giving sellers a slight edge in today’s market. (A six-month supply is considered a healthy market.)
South Carolina saw the biggest price gains, with homes showing annual appreciation of 10.3 percent. Other states showing big gains were Colorado (9.8 percent) and Washington (8.8 percent), CoreLogic reports.
High prices have also spurred builders to start constructing new single-family homes, sales of which increased 23 percent year-over-year in May.
While most states have seen price gains, five states (Massachusetts, Connecticut, Maryland, Mississippi, and Louisiana) saw local home prices fall in May.
CoreLogic economists expect prices to increase 5.1 percent year-over-year in June and 0.8 percent month to month.
Billionaire John D. Arnold, a former energy trader and hedge fund manager turned philanthropist with a focus on health care, says Big Pharma appears to have a powerful hold on members of Congress.
Arnold pointed out that PhRMA, the main pharmaceutical industry lobbying group, had revenues of $459 million in 2018, and that total lobbying on behalf of the sector probably came to about $1 billion last year. “I guess $1 bil each year is an intractable force in our political system,” he concluded.
The Wall Street Journal’s Richard Rubin says Elizabeth Warren’s proposed taxes could claim more than 100% of income for some wealthy investors. Here’s an example Rubin discussed Friday:
“Consider a billionaire with a $1,000 investment who earns a 6% return, or $60, received as a capital gain, dividend or interest. If all of Ms. Warren’s taxes are implemented, he could owe 58.2% of that, or $35 in federal tax. Plus, his entire investment would incur a 6% wealth tax, i.e., at least $60. The result: taxes as high as $95 on income of $60 for a combined tax rate of 158%.”
In Rubin’s back-of-the-envelope analysis, an investor worth $2 billion would need to achieve a return of more than 10% in order to see any net gain after taxes. Rubin notes that actual tax bills would likely vary considerably depending on things like location, rates of return, and as-yet-undefined policy details. But tax rates exceeding 100% would not be unusual, especially for billionaires.
Joe Biden on Thursday put out a $1.3 trillion infrastructure proposal. The 10-year “Plan to Invest in Middle Class Competitiveness” calls for investments to revitalize the nation’s roads, highways and bridges, speed the adoption of electric vehicles, launch a “second great railroad revolution” and make U.S. airports the best in the world.
“The infrastructure plan Joe Biden released Thursday morning is heavy on high-speed rail, transit, biking and other items that Barack Obama championed during his presidency — along with a complete lack of specifics on how he plans to pay for it all,” Politico’s Tanya Snyder wrote. Biden’s campaign site says that every cent of the $1.3 trillion would be paid for by reversing the 2017 corporate tax cuts, closing tax loopholes, cracking down on tax evasion and ending fossil-fuel subsidies.
There were 18 million military veterans in the United States in 2018, according to the Census Bureau. That figure includes 485,000 World War II vets, 1.3 million who served in the Korean War, 6.4 million from the Vietnam War era, 3.8 million from the first Gulf War and another 3.8 million since 9/11. We join with the rest of the country today in thanking them for their service.