I previously detailed that CPI may overstate inflation for an individual who:
- does not own a home
- would like to own a home
- will likely soon buy a home
as it does not include how "affordable" housing has become with the recent price collapse for non-homeowners (full details here).
The Case Shiller Price Index (CSPI) has turned positive year over year for the third month in a row with the spike in August's CPI offsetting further deterioration in the housing market, with the Composite 10 dropping over 17.7% year over year. With future CPI prints coming down as a result of free-falling commodities, expect CSPI to turn very negative in the coming months.