TPH - U.S. home prices out of step' with market fundamentals: Dallas Fed

In a backdrop of consumer price inflation surging at multi-decade highs, the historic acceleration in U.S. home prices since the onset of the COVID-19 pandemic is "out of step" with market fundamentals, according to a blog post by the Federal Reserve Bank of Dallas.  “Our evidence points to abnormal U.S. housing market behavior for the first time since the boom of the early 2000s,” the Dallas Fed highlighted, citing real time housing market data characterizing potential signs of "exuberance." The data suggested that “the U.S. housing market has been showing signs of exuberance for more than five consecutive quarters through third quarter 2021.” Price-to-rent ratios in particular have become unhinged from market fundamentals and moved into the exuberance stage, or "expectations-driven explosive appreciation," the Dallas Fed researchers noted. For company-specific context, Pennsylvania REIT's (PEI) robust fourth-quarter funds from operations reflected higher rents and occupancy rates. This comes as rental affordability issues rose in

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U.S. home prices "out of step' with market fundamentals: Dallas Fed