Core CPI (Excluding Food & Energy) vs Existing Home Sales (Annualized)

What Core CPI (Excluding Food & Energy) measures

Core CPI measures consumer price changes excluding food and energy, which are volatile and often driven by supply factors rather than monetary policy. It is the Fed's preferred gauge of underlying inflation trends.

Core CPI at 3.1% shows that underlying inflation remains sticky above the Fed's 2% target. Housing costs and services inflation are the primary culprits. For executives, sticky core inflation means the Fed is unlikely to cut interest rates soon, keeping borrowing costs elevated. Budget planners should assume inflation-adjusted cost increases of 3%+ for services, labor, and real estate.

What Existing Home Sales (Annualized) measures

Existing home sales measures the number of completed sales of previously owned homes, expressed as a seasonally adjusted annual rate. It accounts for approximately 85-90% of all home sales in the U.S.

At 4.26 million, existing home sales remain well below the 2021 peak of 6.1 million. The 'lock-in effect' — where homeowners refuse to give up sub-4% mortgages — continues to constrain inventory. For executives, this suppressed transaction volume affects real estate commissions, moving services, home improvement spending, and mortgage origination revenue across the industry.

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