0:01 hello and welcome to people making money I'm your host Kevin bemel and we are here every Wednesday at 10 amm Pacific time to talk about all things related to Business and Professional success and wealth building today is our regular monthly feature called economic Echoes where we look at the economic data and break it down so we can understand how it applies to us as individuals so it's all good and well for us to know what the inflation rate is for the entire country but most of us
0:38 don't buy the exact basket of goods on which it's based for example and so therefore it's it's not particularly relevant to how we experience our economic lives so I'm going to jump right in and get started because there's uh quite a bit to go through i' I've added some some new statistics and let's see why hold on one second yeah for some reason it doesn't
1:13 want I'm not finding that one okay I want to because I want to do the um that's weird let's see where it is huh very very interesting one two three four five six seven eight n 10 this is this is boring isn't it I have this all set up um and uh it's that's really really
1:50 weird that it's not letting me it's not giving me the first one on the list okay uh let's see what are we going to do here I've got an idea let's go back to let's let's see if we open this up and see what happens okay now let's try this here we go one more time oh there it is okay it came up twice all right well you know this this is uh you know this is technology what a great thing okay so first thing we're going to look at is the
2:26 um is is the Consumer Price Index um this is the you know standard measure of inflation now the Consumer Price Index for all items Rose 2% in August okay and you can see here it is 2% for all items food went up two um actually okay so the overall rate I should say the 12-month rate not the overall rate the 12-month rate um was 2.5% okay food went up 2.1% energy went down by
3:01 4% okay and everything all items except food and energy went up 3.2% okay so you can right as I've talked about before right away you can see that if you are for example not a big energy consumer let's say you live in a mild climate you don't have a car so you're you you can see that um energy Commodities the price went down 10% okay but Energy Services went up 3% % so let's here you can see fuel oil went down by looks like about 12% yeah
3:37 12.1% gasoline went down by 10% but if like here in California we don't use fuel oil so it doesn't matter that it took such a dramatic decrease um because um it just it you know we don't buy this now gasoline we do of course in California however um what I will say is like like for me I don't drive very much I maybe use a tank of gas every two to three weeks so the fact that gasoline prices went down so
4:13 much doesn't doesn't really have an impact on me okay this should take us okay this takes us back so you can see um for for energy okay now let's look at Food okay so food at home went up 0.9% % food away from home went up 4% so again if if I I think of I look at myself and I say well I eat at home I rarely eat out so my food costs only went up about 1% whereas if I ate out at restaurants my food costs would have
4:48 gone out a lot more so if you're doing a lot of you know uh food delivery and such your food cost probably went up more than the 2.1% overall okay and here again look at um what you know different kinds of foods so food at home cereals and bakery Goods went down by 3% meat poultry fish and eggs went up by 3% so if you have that uh you know high protein diet your food co cost probably went up okay Darian related products went up just a little bit
5:24 fruits and vegetables went down slightly okay and and that that's the large part of my diet right so um and here uh what are what are these alcoholic beverages and beverage materials okay so you know if you drink wine or whatever that went up 1.3% and finally other food at home went up by 0.4% but the main takeaway here is if you eat a lot of meat poultry fish and eggs your food cost probably went up more okay then would have been would have been the case um if you um you know
5:59 did didn't eat uh a protein heavy diet uh and again just just going back to this so food away from home went up 4% okay so full service meals slightly below 4% uh food away from home limited service meals and snacks slightly more okay not not a big thing but I mean if you you know if you eat fast food or you go to restaurants a lot the bottom line is your food costs went up quite a bit okay and then all items less food and energy so Commodities when the cost of Commodities went down these are Commodities not including food and
6:35 energy Commodities Services um went up by almost 5% so let's look at these okay so apparel essentially unchanged new vehicles went down 1% used cars went down um 10 over 10% okay but if you didn't buy a used car what difference does it make right um so uh commodity let's see these are medical Commodities okay went up about 2% um alcoholic beverages um went up uh about 2% and to
7:13 so if you if you're a smoker so the cost of cigarettes and smoking products went up over 8% so again if you're a smoker you likely experienced a higher rate of inflation unless you happen to buy a new car at the same time but do you see how this works depending on what you're buying it really impacts um you know how things um you know how you experience inflation okay and then in terms of services so shelter went up 5% oops okay that's as far as that one goes uh here Services okay Medical
7:49 Services went up a little over 3% and transportation went up almost uh 8% so you know shelter affects all okay um Medical Services probably affects us all although if you were healthy in the last month then you didn't consume any medical services transportation services again probably everyone is affected by that so as you look at these different numbers you should see you should get a sense for why you may feel like well gee
8:24 I didn't I don't feel like my prices went up very much or maybe I feel like I actually feel a little bit better off um fell a little bit better off in August than I did in uh June July well that may be because if you if you um consume a lot of energy Commodities gasoline and fuel oil so you had a big a big drop right um on the other hand like I said if you if you eat a a protein Rich diet if you are a smoker those kinds of things would tend to mean you would experience higher inflation
9:00 then um then you would have um you know if if you if you didn't have those things okay so next let's look at I'm going to look at the Consumer Price Index for Los Angeles now obviously Mo you know you don't you don't necessarily live in Los Angeles but you can look up the Consumer Price index for for your location okay by the way all these links will be um in the
9:36 show notes after the show posts um but you can find a chart for the urban area in which you live so in for here in California in August um inflation dropped a little bit from uh let's see about 3.4% to looks like it's just below 3% so um pardon me um inflation went yeah 2.9% um overall inflation so food prices
10:11 um increased 2.5% Energy prices declined 88.8% in California okay and and food I mean all items less food and energy Rose 3.9% so again you can see the reason overall that it dropped was such a big drop primarily in gasoline prices here in in Los Angeles okay and you so you can see and and here here if you read in the details below so you'll see um food prices Advanced uh 0 2% food prices at
10:47 home increased 0.4% food prices away from home decline one% so see I guess I should be eating out more okay food prices um year over over the year increased 2 and a half% but food prices at home Rose just a half a percent but they were led by proteins Meats poultry fish eggs 3.7% food away from home overall Rose 4.9% here in California over the last year okay and going down to energy so
11:26 overall Energy prices decreased 1.5 5% in August mainly due to lower gasoline prices of 2.7 of a drop of 2.7% okay natural gas increased 0. 2% and electricity prices were unchanged now looking at the year Energy prices declined 8.8% year-over-year and it's largely due to gasoline prices declining over 133% okay but also prices for natural gas declined
12:01 14.6% even and and and prices for electricity went up 6% so you can see that energy costs in California are declining this is good news you know for those of us who live in the Los I I shouldn't say in California in Los Angeles decline which is uh you know good news for for us and then overall um I mean not overall uh items less food and energy okay they went at 0 2% in August um uh clothing apparel went up over 3% shelter went up just 3% so not not a not a large um uh increase but
12:37 these were partially offset by new and used motor vehicles declining by 1.2% and household furnishings and operations declining by0 6% but again if you live here in Los Angeles you didn't buy a car it doesn't matter that um car prices went down um if you did Buy apparel you're you're you know you experience you know a higher um level of inflation okay and then finally um looking at the year-over-year in rate of inflation for all items less food and energy okay that
13:14 went up 3.9% so almost 4% and it was led by medical costs which went up 6.4% and shelter which went up five and a half percent now here's the thing most of us have some kind of medical expense and have shelter expense uh so we experienced those now they were offset by the prices of new and used motor vehicles but if you haven't bought a car in the last year doesn't matter right you you experienced a higher overall inflation rate same with same with Recreation if you don't do a lot of
13:49 recreation I exercise and such but I don't pay for recreation so the fact that Recreation went down by 3% in the last year really doesn't impact me so as you look at these things you should be able to get a sense of how am I experiencing inflation and and and why is that different or why may that be different than what's being reported in in the news Okay so next let's look at income okay so or earnings I should
14:26 say so earnings um went up by uh hourly earnings went up by two cents from July to August okay so that's you know a 0 2% increase um roughly in line with the overall inflation rate okay so a as a country right our earnings basically kept paced with inflation now here's the interesting thing average weekly earnings went up by about $2 okay which um equated to a half a percent increase um not sure why
15:03 statistically that works out because you can see um when you look at oh this is Consumer Price Index 0 2% okay so um in any event um and and uh okay average hourly earnings um went up by 14 cents okay and so the averages really don't mean as much as the real average because that's that that is um uh adjusted for uh I mean as it's seasonally adjusted so
15:38 so you can see that we're still not seeing particularly strong um income growth so year-over-year okay average hourly earnings went up 1.3% and average weekly earnings went up 0.9% but inflation went up 2 6% so again looking at us as a country we are still falling behind because inflation is growing faster uh prices are increasing faster than uh than than wages are so I
16:16 the the state figures on earnings um won't be updated until later this month so we'll look at those next month and see and see how that's going oh shoot I just real realized I didn't show you the chart okay well I'm I'm not I'm not going to go back on that um okay next civilian unemployment okay all right so the civilian unemployment rate okay you can see it was uh 4.2% in August which is down a
16:52 tenth of a percent from July that's the overall um oops what did I do here that's the overall unemployment rate so it's still it's still at about you know still over 4% although you know 4% is not a terrible unemployment rate now let's look first of all at men 20 years and over so their unemployment rate um this month is 4% which is even with what it was in July okay as opposed to women 20 and
17:28 over so women 20 and over their unemployment rent unemployment rate is 3.7% this month uh oops uh down from 3.8% in July so it went down slightly okay now let's look at teenagers okay notice their unemployment rate went way up to 14.1% from July where it was at 12.4% okay now remember August is still the summer although um I know some some uh teens went back to
18:04 school um but uh you know teen unemployment um so so you you can you can see that um let's let's find another August period here let's look at um okay April May June July August oops August okay so August 2019 teen unemployment was 12.3% % versus July of 2019 it was 12.6% okay um July 2023 it was
18:40 11.3% August 2023 it was 12.3% so you can see that having jumped up to 14.1% teen unemployment is definitely significantly worse this year than it has been since well that's and that's in January um since November of 2017 that was the so 2017 um early 2018 was the last time teen unemployment was that high okay so it is it is a sign that the economy is cooling okay which is what the Federal
19:17 Reserve has been trying to get happen and of course typically teens are hit first in terms of unemployment okay unemployment among among white Americans in August 3.8% on on par with with July so it was basically the same for black Americans um unemployment in August 6.1% down from 6.3% in July so improved a little bit for black Americans okay asian-americans okay so August
19:53 unemployment went up to 4.1 from 3.7 in July so the August figure is basically back to where it was in June for asian-americans and then finally for Hispanics Latinos okay August the EMP unemployment rate five and a half percent and in July it was 5.3% so it did tick up a little bit so overall although overall unemployment went down a little bit um or um you know just slightly you can see depending on
20:29 what your demographics are um you may have experienced that differently now as I've mentioned before um you know the unemployment rate doesn't mean a whole lot to us as individuals um if we're already employed except that it's an indicator of whether you know we we we want to um you know not quit our job so um you know and and so these National statistics um don't mean a whole lot to us but let's look at the state
21:05 statistics okay unemployment rate for States and you will see once again South Dakota has the lowest unemployment rate in the country followed by Vermont North Dakota New Hampshire Nebraska Mississippi Etc so um the lowest unemployment for the most part is in the midwest the and the southeast okay um Vermont and New Hampshire are sort of
21:41 the outliers in the Southeast there okay on the other end of the spectrum um Washington D District of Columbia has the highest okay five and a half percent now that you're going to find that interesting I I think because you're going to see that once again one the biggest increases in employment was in government services okay Nevada took the number two po spot the I should say the 50th spot and then California and Illinois were tied for 48 so they you know 48 49 the 48 and
22:16 a half spot right but you can see that um as aside from um Kentucky and Ohio most most of the states um that have the highest unemployment um are large states um and that that um um tend to be in the um uh you know Northeast Seaboard or here in the west okay so Washington um California and where Oregon here is is at 4% okay so all of
22:53 those are um above the mean um and let's see here where's 25 okay so the mean is at about 3 a half% and and and so you can see the states that are doing better so if you're employed of course unemployment doesn't mean a whole lot to you because you have a job if you're unemployed then the unemployment rate in your state makes a difference right because that gives you an indication of how easy it's going to be to find a job and you know and if you're unhappy with your job um but but have to work so then
23:28 you know it's really something to consider how tight is the job market in terms of being able to find another position all right next let's look at uh civilian labor force participation rate okay this is the percentage of people who in in in a particular demographic that are participating in in the labor force so the labor force participation rate in August was
24:03 62.7% overall that is up just or no that's even with July okay so the fact that um unemployment um went I think it went down slightly right so it went down slightly a tenth of a percent um so that is that is not due to more people entering the workforce it is due to fewer people working so um among men 20 and older the labor force participation rate went down two10 of a percent to 70.3% in August from
24:41 70.5 um versus women the labor force participation rate went up from 58.9% to 59.2% so um employers were were replacing uh male workers with female workers it appears okay and we'll we'll put on top of that so the teen participation rate declined by 35.7% okay so so this is particularly interesting I'm sorry didn't decline by 3 35.7% it went down to
25:17 35.7% from where's the July figure from 36.4% so what that means is even even as teens were leaving the workforce their unemployment rate rate went way up which means a lot of teens lost their jobs okay and and and that is a sign of a weakening economy okay for white Americans the labor force participation rate in August 62.3% versus July it was flat okay for
25:52 black Americans labor force participation rate 62.7 in August down from 63.2 so it declined five not 5 per half a percent okay um now as the labor force participation rate uh declines so let's see we also saw we also saw black unemployment black American unemployment Decline and that could be because not because um um more more
26:29 black Americans are getting jobs but because more black Americans are giving up looking for work okay so that's why we need to look at both of these statistics in concert to really understand what's happening okay for asian-americans their Workforce participation rate also declined to 65.4% from 65.9% also a half a percent Decline and and again um Asian um Asian unemployment went up in August so at the same time that labor force
27:06 participation rate was declining unemployment was still going up so among Asians that means asian-americans were losing jobs faster than they were giving up looking for work okay and then finally for Hispanics or Latinos okay their Workforce participation rate went up a half a percent to 67 .8 from 67.3 and that um Compares with their unemployment rate also going up um uh
27:41 about 0 2% so it could be that rather than Hispanics losing their jobs what's happening is more Hispanics are entering the workforce which makes the UN their unemployment rate look higher even though Hispanics in general we're not losing jobs okay so from a demographic standpoint that's that's comparing Workforce participation rate with the unemployment rate like I said those two really have to be looked at in concert I don't have Workforce participation rates state by state I'm still trying to find
28:18 a source for that but um I I I'll keep looking okay next we're going to look at um excuse me we're going to look at employment change by industry okay so the largest increases once again were in construction which gained 34,000 jobs or a0 4% increase private education and Health Services 47,000 jobs for a0 2% increase uh Leisure and Hospitality 46,000 jobs
28:53 for a 3% increase and government 24,000 jobs for A.1 % increase now the key thing to note is because government pays for so much of uh education and Health Services these are really government funded increases in employment whereas construction and Leisure Hospitality are private sector funded increases okay so we can we can look a little bit into some of the details so in construction it across the board employment increased
29:29 okay construction buildings and you can see residential construction was really leading the way as opposed to non-residential construction okay now let's look at private education and Health Services so and again you can see private Educational Services really was a small increase in jobs it was really health care and social assistance again both primarily publicly funded that increased okay um nurs Nur in and Residential Care Facilities actually declined but hospitals and Ambulatory Care Centers saw big increases okay
30:05 let's go back to healthcare for a minute um hospitals oops okay and um okay so that's that's healthc care now um Leisure and Hospitality so both both had you know pretty decent increases in employment so Arts entertainment so most of this was in Performing Arts uh spectator sports and related activities as opposed to museums and historical sites which actually declined and a small increase in Amusement gambling and Recreation okay um that's compared to
30:40 accommodation and food services so accommodation employment went up just a little bit food and and and uh I'm uh sorry food and drinking went up quite a bit um almost 30,000 jobs okay and then finally government so local governments led the way with hiring okay um and state government and state and federal government basically the hiring just a little bit but it was essentially flat okay and local government hiring um education went up
31:16 somewhat but it was really in um local government um excluding education that most of the jobs were created now let's contrast those with the sector that declined all of them private sector manufacturing retail trade and information so let's look at manufacturing durable goods manufacturing declined 25,000 jobs that is a sign that the economy is slowing that is one of the things that economists in the FED look at okay whereas non-durable Goods actually employment went up just
31:51 slightly okay and if you want to look at where did durable goods uh decline the most so look Transportation equipment manufacturing went way down um compared to the others okay electrical equipment and appliances um another large drop computers went down Machinery uh Furniture went down so almost across the board well I mean across the board all sectors of durable goods went down but it was really um it was not only in um things like furniture and appliances but also machine tools
32:29 and and the the kinds of durable goods that are used to make durable goods that went down okay as opposed to non-durable Goods so food manufacturing employment went way up and that was offset by declines in textiles and textile product Mills um Printing and related activities chemical manufacturing so um tobacco actually went up a little bit um but um so it was really food and tobacco that offset these other declines okay so depending on what sector you're in or
33:06 what what if you're looking for a job this is showing you where job growth is currently occurring uh okay retail trade so this is kind of a mixed picture so employment in motor vehicle and parts dealers went up but building material and garden equipment went down food and beverage retailers went up now interestingly enough Furniture home furnishings and Appliance retailers their employment went up even as the employment for manufacturing those went down but general merchandise retailers went down health and personal care retailers took a big big drop by you
33:42 know by comparison 6.6 th000 jobs okay gasoline stations basically even and clothing and Retail went down 5.5 th000 jobs and then sort of amusement musical sport uh sports sporting retailers that they also declined so you can see that the few sectors that went up were offset by much larger declines in other retail sectors okay um oh so I these are Motor Vehicles so um interestingly enough motor vehicle parts went up employment
34:17 went up while um Mo as did automobile dealers slightly although statistically it went up you know 0% other motor motor vehicle dealers um which would be like motorcycles and that kind of thing their employment went down okay and and so you can see it was really parts that are driving motor vehicle and um Pop um employment increase which again is a sign that things are slowing down people are repairing their cars rather than buying new ones okay let's look at one more let's look at clothing oh no that well
34:55 that's just it is what it is okay and and Healthcare and personal retailers nope that just is what it is okay so there's no detail on those okay and last we're going to look at information so motion picture and sound recording lost 4.2 uh 4,200 jobs uh publishing 3.7 th000 jobs uh broadcasting went down by over a thousand jobs they were slightly offset by telecommunications computer infrastructure and web online services but but overall you can see big drops in
35:31 Motion Pictures and sound recording and Publishing and broadcasting okay these are really the drivers of employment change okay and and so that's why overall information lost 7,000 jobs okay so depending which sector you're in again this gives you an idea of of how particular Industries are going in terms of employment opportunity now let's look at the thre Monon you can see most of these Trends stay the same same with six months and same with the 12- month now it's it's startling not startling but um
36:07 of the jobs that were created in the last 12 months almost a million of them were in private education and Health Services and again private education services only 38,000 of those the vast majority were in health care and Social Services which are all driven by um government spending okay and uh government again let's look at government so you can see over the last year local governments have um accounted for over half of government employment increases but still state governments
36:44 have increased employment over 100,000 jobs and the federal government o over 50,000 jobs so all sectors of government are increasing and indeed the the increase in federal uh federal government jobs was offset slightly by a decrease in Postal Service workers as you know the postal service is not doing at all well okay so if you're considering changing jobs or or looking for a job in a different industry definitely take a look at at at
37:20 these these employment trends um I mean these um yeah these employment trends because they're really going to give you a sense of where there is opportunity okay now um employment um by industry state by state okay uh here we go okay so this is total non-farm employment and of course the largest states have the largest number of people employed um we can look at let's look at construction okay it doesn't really change the picture that much uh from the
37:57 National or from I mean from the overall uh what was another one we looked at information okay again the picture doesn't change so much um education and Health Services again the biggest states have the biggest um population um biggest employment numbers Leisure and Hospitality okay um doesn't change the picture too much and finally government so um you can you can see where which states have the largest number of people employed in in government so um you can look at your
38:32 state and and get a sense of um what the employment figures are and then um you can you can also look to go back to a previous month and see how they've changed and and and that will give you an idea of um where opportunity is in your specific State okay uh all right let's move on from there [Music] to okay job
39:11 openings all right so job openings actually overall actually decreased um 0 2% so they dropped by this is going from June to July they dropped dropped by approximately this looks levels in thousands so they dropped by approximately um 200,000 it looks like okay so um but you can see that job openings um have been declining they did bump up in May but they've been
39:47 declining in in July of last year um there were um 8, 800,000 job openings this this year in July there's about 7.7 million job openings so year-over-year there's a you know a pretty uh significant um decline in job openings okay um and that's important because um if you are needing to look for a job um in general you want to look at an industry where job openings are
40:22 increasing because that means you will be in Greater demand so let's look at at some of these in construction okay job openings actually decreased by over half a percent by0 6% okay going from June to July so that would indicate that opportunity in for to find job in construction is decreasing now let's compare that with let's find one that's increasing okay here is oh other services okay I don't now that doesn't do us any good because who knows what that is okay so interestingly
40:57 enough openings in arts entertainment and Recreation increased by 6% okay so if that field interests you so there are more jobs opening up there and since they're looking to fill more positions they you know that might give you an advantage okay let's look at private education and Health Services openings went down by 7% so even as uh employment is increasing the rate of increase in private education and Health Services is probably tapering off um as it is
41:36 in well it's actually overall increasing in government um that's a weird statistic um because it's increasing in state and local it's decreasing in state and local governments there's some there's some kind of statistical aberration there evidently um so it's hard to say what the read is in in in government unfortunately let's see wait let's oh no I'm sorry I'm sorry I I was reading the wrong line okay so overall um employment uh job openings in government decrease but they went up
42:11 almost a percent in the federal government while decreasing on the state and local level so if you're thinking you want to go to work for the government the opportunity right now is working for the federal government where there are a lot more where where job openings are increased okay and then finally Leisure and Hospitality was flat in terms of the rate um and you can see there was um 943 th000 openings in June 941,618
43:04 okay job openings by state sure okay and you can see that um the states with the um uh highest rate of job openings overall it's 4.6% but Alaska is at 6 6.4% Colorado 6.1 Oklahoma 6 Mississippi 5.3 Kentucky 6.2 West Virginia 6.3 Virginia 6 and Maryland 5.8 so those have um the
43:39 highest percentage of job openings and you can see as as the color gets lighter the percentage of job openings declines now let's look at well yeah we can't we can't go into sectors unfortunately so okay so so again you know if you're if you looking if you're looking for a job the most job openings tend to be in the dark green states with the you know medium green States following so it's it's it's interesting that there's a lot of job openings in North Dakota even
44:16 though it h I'm sorry North Dakota was fire the there's um kind of a mid-range number of job openings in South Dakota but South Dakota as you recall has the lowest unemployment rate in the country um Vermont had I think it was the second lowest unemployment rate um but and and it but it has a on the higher end of job opening so you know as you look at that there's a lot of job openings in Vermont but there's a low unemployment rate so that's an opportunity because um what it
44:51 means is there's a lot of jobs but not a lot of people to fill those jobs okay so um ideally what you want to look for if you're thinking about relocating is a state with a high amount of job openings but a low unemployment rate because that means employers are going to find it difficult to get people and they're going to have to compete for for for employees by uh raising wages or at least offering more favorable um employment terms and District of Columbia okay so that had a very
45:26 District of Columbia had a had the highest unemployment rate you recall 5 a half% they also have a pretty high rate of job opening so um most of which are probably uh it would appear for the federal government okay all right so um and let's let's just go back to yeah here let's see let's look at where is okay so Mississippi has a 2.7% unemployment rate but it's got a 5.8% job openings rate so again low
46:01 unemployment High number of jobs good area to consider going to if you're looking for a job let's find Oklahoma no I think Oklahoma okay yeah Oklahoma has a mid-range um unemployment rate um let's see Mississippi let's look at Colorado that might be where is Colorado Colorado nope Colorado Okay so Colorado has a 3.9% unemployment rate so again higher
46:38 unemployment rate high percentage of of job openings but not as good not as good an environment as say uh New Hampshire or North Dakota so North Dakota I think had a 2.2% unemployment rate but it has 4.9% job job opening rate so High number of jobs open low unemployment rate you know opportunity okay so those are the kind of things um I recommend you look at if you are if you are going to be job hunting now let's see all right so now we're
47:14 going to get into something I haven't covered before and that is I'm gonna we're going to look at the median sales price of homes sold in the US okay and you can see that the median home price has increased from uh $177,800 in the first quarter of 1963 to uh $412,500 in the second quarter of 2024 so it's it's gone up a lot but most important is
47:50 since 2020 the med median home price has gone up from $329 ,000 to $412,000 I.E it's gone up over $80,000 that's roughly a 20% increase okay and and but now by the way the median home price is down a little bit from its high of $142,600 in the fourth quarter of 2022 so median home prices are way way up in the last few years now of course we're
48:27 not buying oh shoot I'm I'm so sorry I forgot to click this up here real quickly so you can see the graph you can see how it's gone up okay up up up up up okay here it is in 2020 300 uh 317,000 actually and here it is in uh 2024 so it's gone up uh roughly $100,000 $95,000 since the uh second quarter of 2020 so in four years it's gone up $95,000 that's pretty that's that's over
49:02 30% okay huge huge increase and you can see by the steepness of the curve why you know that that's the case Okay so but of course we're not buying the median home in the United States we can't do that we have to buy a median priced home in a particular location and so we're going to look this is the United States housing market this is on Zillow and what this allows us to now now by the way this is this is looking now at the average home price which is
49:38 different than the median home price the median home price means 50% of homes cost more than the median 50% of homes cost less than the median the average home price is the total value of all homes is x divided by the number of homes that gives you the average so the media and the average are not the same thing I couldn't find a a state by state or a city by City median home price calculator but Zillow gives one for average so let's look at let's say Omaha Nebraska
50:14 okay and here you go so the median home price in Omaha Nebraska is just under $280,000 it's up 25% for the year but it's considerably below the national um the national average which is 361 okay now let's look at um you know perhaps on the reverse end let's look at Los Angeles oops here Los Angeles California okay the median home price is over 940,000 up
50:50 3.6% okay so you can see obviously the not I'm sorry if I said median average home price 900 almost $942,000 in Los Angeles okay now let's look at a couple of pop popular markets to relocate to Miami okay Miami Florida okay median um average home price $580,000 up 7 and a half% year-over-year okay and another popular place to go to Dallas Texas
51:28 and I'm not sure why it's not clicking through huh I don't know what what the deal let me try something oh there we go okay so Dallas Texas uh average home price 313,000 up slightly just 0 6% so you know housing much less expensive in Dallas Texas okay and also increasing much more slowly than Miami so if you're
52:03 thinking about relocating this is something to look at first of all what are average home prices now that's not the full picture though so let's next look at oops wrong one sorry about that I clicked on the wrong
52:41 thing okay here we go no wait okay yeah here we go okay now let's look at rent um so if you're not a homeowner then you're a renter right and and this is showing you um the uh median rent in various markets you can see in Phoenix Arizona it's it's down to 1995 La 2800 so you can see in these markets it's gone down and in general it's gone down however in Chicago it's
53:16 overall up okay but we can look specifically so let's look at let's look at the same markets let's look at Omaha Nebraska first of all okay so um the median rent for all apartments just under $1,500 which is down uh $29 month over month but it's up $28 year over-year okay now let's go back and let's look at Los Angeles okay Los Angeles the average
53:52 rent or the median rent is $2,800 okay up about $5 month over month but down almost $200 month over month okay so um what you and you can see the median rent oh that's last year here so you can see in indeed rents have been pretty flat here in Los Angeles over you know for this year okay even though and but they're they're down significantly from the year before so that's good news
54:27 for um you know for the California Market okay let's let's look at another area let's look at Miami okay so Miami 2 um rents were much higher last year and then they came down toward the end of the year they've gone up a little bit since the end of last year but they've stayed pretty moderate below 3,300 a month you can see right now the median is 3,200 a month that's even with last month and down $200 uh or almost $200 from a year
55:03 before so you can see that Gap there okay um and uh but you can see from in January January it took the big big drop it's really it was really you know January of 2023 to November that was really the big drop okay so rents are also declining in Miami and then finally let's look at Houston okay again all these links will be in the show notes so you can do this same kind of analysis so median rent in Houston just under $1,900 down slightly
55:38 from last month but up $66 from the before so Houston the market is the opposite it's been elsewhere so rents in Houston this year are higher than last year okay that would tend to indicate perhaps there was very little Construction in Houston and so the supply of apartments available shrunk um allowing landlords starting in about April of this year to to increase their rents they increased them through June and now they've been you know roughly flat with with June okay so um if you're
56:16 again if you're considering considering relocating and you're going to be renting first this is something to take a look at rental costs now you can't can't look at well I'm not saying you can't but one of the just like looking at unemployment you should also look at um Workforce participation rates when you look at housing costs both on the um purchase and the um uh on the um rental side so what you
56:52 want to look at is the home price to median household income ratio now this is a chart for all of the United States okay but what you can see is starting in 1946 okay the ratio of home price to how median household income was essentially six meaning the cost of a home was six times the median income now one of the reasons that was the case was there was a tremendous shortage of housing just
57:27 after the end of World War II as housing got built you can see it declined it declined it declined until it got all the way down to about 3.75 this is in September of 1968 that's basically bottom out now it stayed below uh well stayed you basically below four for a number of years until um 1978 and then between 1978 and um let's see what is this this
58:05 is 2001 it basically stayed below five since 2001 it has increased significantly okay and though although in 2012 um it it end of 2011 2012 it dropped alow five slightly it's been above five and above six and now it's above seven an alltime high so when we talk about housing affordability it's at an alltime it the
58:40 the ratio as of May of this year which is the most recent figures that this chart calculates 7.16 um is the ratio of Home median home price to median household um income and that is yeah that is a record because the highest before that was 7.13 okay so part of this has to do with interest rates being higher um part of it has to do with um in insufficient supply of
59:15 housing now while this chart of course doesn't really mean anything to you as an individual but what you can do is use the oh gosh sorry again I keep forgetting to to do that okay so here you can see the chart so I'll let you see the chart while I'm up while I'm giving these comments so um what you can do is use the previous uh links that I gave you to look up what is the median home price where you live or want to live what is the median income in that same area or
59:51 what is the average home price and then you can figure out what the multiple is obviously the lower the multiple the more affordable housing is in that location the easier it will be for you to own a house now we're all anticipating that the Federal Reserve is going to start decreasing interest rates as of um their announcement either later today or tomorrow so that will ease loan costs hopefully which should bring down um well we would hope
60:26 it would bring down housing costs um it whether it will bring down housing prices or not I can't say um it's but it is frankly more likely to increase housing prices because as the cost of a loan decreases more people can afford to buy homes and so that will increase demand for homes even though the supply of homes is still there's still a big shortage okay so it's hard to say what's going to happen with housing affordability going forward but I would say it's more likely that the um home
61:03 price to income ratio is going to continue increasing than that it's going to decrease okay let's go to the next [Music] item okay so you'll see this link if you want to know the median house household income by state so um you'll you'll find this link this will help you figure out the home price to income ratio okay so for example California median income is
61:39 just under $85,000 this is as of I think the second quarter of 2024 I believe okay well I I it's it's it's for this year in in any event okay um and you can see the darker the the color the the higher the medium the state medium income so Washington DC has the second highest slightly over $90,000 Maryland has the highest at $9,200 whereas Mississippi here I'm going to go to the bottom okay so
62:16 Mississippi has the lowest median income um uh at at a little bit uh at just under $49,000 followed by West Virginia at a little over 51 and Louisiana a little over 52 Arkansas also well 52,500 Alabama 53,000 so you can see these are the lowest median incomes okay but they're also likely to have the lowest home prices so for example in Nebraska let's find
62:53 Nebraska's median income it's going to be [Music] somewhere where's Nebraska should should start okay well why can't I find Nebraska Nevada okay here Nebraska okay so Nebraska has a median income of just under uh $67,000 so if if I recall the um average
63:31 home price in um Nebraska at least in Omaha I think it was about 280 yeah was it's about 280,000 so I'm just going to do a rough calculation here okay so uh $280,000 average home price divided by um median income 6687 equals so the ratio of home price to median income in Nebraska is
64:08 4.2 way way below the national average okay so that that shows you that housing in Nebraska is much more affordable than let's let's now let's look at let's look at um California so we we looked at um I think it was Los Angeles and if I remember the home price was 941,618 oops
64:56 and we're going to divide that by the average by the median income in California which is 84,7 okay we get a housing cost to income ratio of 11.1 okay California one of the most expensive states to live in so even though California has the uh sixth highest median income in the country um
65:31 because its housing prices are so high it's housing is among the least affordable in the country okay so this is a kind of calculation I would recommend you do if you're considering you know relocating because it's it's all good and well to say well you know um I'm thinking about um relocating to to uh Washington well washing because Washington has a median income of over $84,000 well that's great but housing may not be more affordable in Washington
66:06 than it is where you're at even though you can get a much higher salary okay so now obviously we're talking on a purely economic basis here um if there's other reasons for relocating of course those need to be taken into account okay and uh um next okay I'm just going to look at a couple of other things um I'm I'm still looking for better statistics so these are the rankings of average net worth
66:43 and median net worth um and you can see here that the St the states with the highest net worths um are are not surprising Connecticut average net worth $888 $878,000 California $778,000 Vermont New Jersey Washington Massachusetts New Hampshire okay New York interestingly enough is 650,000 we think of Manhattan as being a very um wealthy area I mean we think of New York as being Manhattan but of course um
67:18 outside of Manhattan um net worth and salaries are much lower than in the city so this gives you an idea of what the average net worth is um per state now North Dakota has the lowest average net worth okay and and just you know to give you an idea this will help you kind of Benchmark for if you're living for example in California um where are you with respect to net worth of your peers I don't mean this from a competitive stpoint but um what is it likely to take
67:53 to be able to retire in California that's why I'm showing you these statistics I'm looking for some better ones but I thought I would share this with you just to give you an idea so you can kind of Benchmark yourself against the average and then the last thing I'm going to show you is okay Social Security and retirement income so these are the uh cities with the top 20 uh retirement income on average and you can see it's made up of two things retirement account income which
68:29 is IRA and 401ks and that sort of thing Social Security and then total so highest retirement income is in Arlington Virginia over $90,000 from there it drops to Cambridge Massachusetts under $80,000 presumably there's a lot of retired uh um Harvard professors and then interestingly enough the Woodlands Texas okay Berkeley California Alexandria Virginia Highlands Colorado District of Columbia $75,000 this is because people who are retired in in in Washington DC probably have a
69:05 federal pension okay carlbad California also in the top 20 as is Irvine okay as is Torrance as is sunny Vil which is in the Silicon Valley so you see a number of California cities but you also see both Sugarland Texas and the woodlands in Texas and you see Columbus Maryland as well as DC again those and and Arlington Virginia those are all centered around um go areas of of f the federal government where you have federal pensions that that make um retirement income higher so again I'm
69:40 I'm I'm looking for statistics that I can share with you that'll help you understand what it's going to take to retire I'm going to continue to refine those so please do continue to tune in each month oh gosh one last time I forgot to show you this that's okay it's it's it's fine um please do continue to tune in each month because I'm I'm looking to give you ever more information and links that you can use to figure out your own situation so that you can understand what what decisions do you need to make
70:17 so I I don't want to continue going on we're a little bit overtime here but it it is it is um important to understand these things on an individual level so again one last time all the links will be in the show notes if you have any questions comments please feel free to drop them into our social media or send me an email the links are also in the show notes and I thank you very very much for watching today and wish you this is our last show for this week so wishing you a wonderful rest of the day and a wonderful rest of the week and signing off as I always do Marie darling
70:54 You are my Bell courage at all times