In this Real Estate News Brief for the week ending January 28th, 2023... what’s happening with inflation, a new surge in foreclosures, and the affordability of renting versus buying.   Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.   Economic News   We begin with economic news from this past week. The latest report on the cost of goods and services shows that inflation is cooling off. The PCE index is the Federal Reserve’s preferred measure of inflation and it shows a tiny .1% increase for December. That reduces the annual rate from 5.5% to 5%. When you eliminate the cost of food and gas, the monthly increase was .3% with an annual rate that’s down from 4.7% to 4.4%. PCE stands for Personal Consumption Expenditures. (1)   We also have a new report on the GDP. The government reports that the Gross Domestic Product grew at a solid 2.9% in the fourth quarter of last year. That’s after a reading of 3.2% in the third quarter, and two negative quarters in the beginning of 2022. Economists generally believe that we’ll see slower economic growth in 2023 due to the Fed’s rate hikes. The rate hikes are meant to slow the economy and help bring inflation back down to the 2% level. (2)   The National Association of Home Builders reported on the housing share of the GDP which is lower than normal due to the constrained housing market conditions. The NAHB explains the two housing market components that contribute to the GDP as the residential fixed investment or RFI which includes home building and remodeling. The second component covers housing services like rent, utilities, and the cost that owners would have to pay to rent their own homes. For the fourth quarter the RFI was 4% of the economy while housing services accounted for 11.9%. That’s a total of 15.9% of the GDP. Historically, the total is 17 or 18% of the GDP with an average of 5% for the RFI and 12 to 13% for housing services. (3)   Weekly jobless claims are down again, to their lowest level since April. Weekly initial claims dropped another 6,000 to a total of 186,000. Ongoing claims were up 20,000 to a total of 1.68 million. Several companies have announced layoffs but that hasn’t had an obvious impact yet on jobless claims. (4)   New home sales were slightly higher in December. The Commerce Department says they were up 2.3% to a seasonally-adjusted annual rate of 616,000. Year-over-year, they are down 26.6%. That hit a peak of 1.04 million in August of 2020. (5)    Mortgage Rates   Mortgage rates were down a little more last week. Freddie Mac says the average 30-year fixed rate mortgage was down 2 basis points to 6.13%. 15 year loans were down 11 points to 5.17%. (6)   In other news making headlines...   Foreclosure Rate Doubles   Foreclosure rates are rising once again, but have not returned to pre-pandemic levels. ATTOM Data says they more than doubled in 2022 compared to 2021, with a 115% increase. In 2022, there were foreclosure filings on .23% of all housing units. In 2021, foreclosure filings accounted for just .11% Back in 2019, before the pandemic, they accounted for .36% of all properties. (7)   ATTOM’s Rick Sharga says: “Government and mortgage industry efforts during the pandemic, coupled with a strong economy, have helped prevent millions of unnecessary foreclosures.”   States with the highest number of foreclosure starts last year include California, Texas, Florida, Illinois, and Ohio. Foreclosures hit a peak at the height of the housing crisis in 2009 and 2010. Back then, almost 2-and-a-quarter percent of all homes went into foreclosure.   Renting Now Cheaper than Owning in Most Areas   Research from ATTOM Data also shows that renting is now more affordable than owning in 95% of the places where most people live. That’s a complete reversal from last year when it was more affordable to own your own home in 60% of the markets that were analyzed. (8)   Rick Sharga commented on the cha