WASHINGTON, DC – American consumers are seeing some relief as the U.S. Labor Department’s latest Consumer Price Index (CPI) report shows a small slowdown in inflationary levels in core categories – declining to the lowest level since September 2021. Over the last year, the ‘all items’ index increased just 3.7 percent compared to an 8.3 percent increase over the same twelve month period the year before. However, the corporate greed epidemic continues to stand in the way of faster progress against rising costs, especially in the shelter sector, an analysis from government watchdog Accountable.US found. Accountable.US renewed its calls on the Fed to cease further job-killing interest rate hikes for the foreseeable future and instead allow Congress to finish its work reining in corporate profiteering from the worst offenders, like predatory Wall Street landlords.
No matter how many times the Fed raises interest rates, many of the nation’s biggest corporate landlords keep shaking down American families for more money despite through-the-roof profits,” said Liz Zelnick, Director of Accountable.US’ Economic Security & Corporate Power Program. “Gross profiteering in the housing sector is badly distorting the overall positive downward trends in costs on everything from food to used cars. It's time the Fed step back from job-killing interest rates and let Congress take targeted action against the greediest industry profiteers, like Wall Street landlords.”
Since last year, escalating housing costs have been the largest contributor to overall inflation, with one estimate finding shelter costs had “contributed to roughly half of overall headline inflation through the first quarter of this year, roughly double the share from June 2022.” Based on the data, it is clear the housing sector is unfazed by the Federal Reserve’s repeated interest rate hike strategy which has threatened the jobs of millions of Americans. Yet, Federal Reserve Chairman Jerome Powell recently announced the Fed is “prepared to raise rates further if appropriate” despite dire warnings from a chorus of lawmakers, academics, and economists that the economy could tip towards a recession if the rate hikes continue.
KEY FINDINGS: Recent earnings suggest the nation’s largest landlords will continue to raise rents in order to pad profits:
- AvalonBay Communities, one of the largest publicly-traded apartment owners with investments in over 88,000 units across 12 states and the District of Columbia, saw its net income increase by 28.4% in the first half of 2023 as residential rental revenue increased by 7.8%, virtually the same increase as shelter in the July 2023 Consumer Price Index report.
- Invitation Homes, the “largest owner and operator of single-family rental homes” in the United States, saw its net income increase by 26.6% in the first half of 2023 as average monthly rent increased by 7.9%, in line with the 7.7% year-over-year increase in shelter in the July 2023 Consumer Price Index report.
- AMH, the second largest single family home rental company with around 59,000 properties, saw its net income increase 75% to $253.1 million in the first half of 2023 thanks to “higher rental rates.”