Personal Income

In each Economic Update, the Research staff analyzes recently released economic indicators and addresses what these indicators mean for REALTORS® and their clients. Today’s update discusses personal income.

  • Aggregate rental income continued to make solid gains, with a 12.7 percent jump from one year prior (February). Wages and salaries were up by a much more modest 2.7 percent.
  • Income from unemployment insurance has been falling sharply as more jobs are created and fewer people meet the eligibility requirements.
  • Both farm income and proprietors’ income are at record highs.
  • Despite the movement in the right direction on income, the total personal income gain of 2.6 percent from one year ago, if continued for the remainder of the year, would be the second slowest annual gain in the past ten years. The disposable personal income per capita is barely growing.
  • The latest savings rate of 2.6 percent is near historic lows. The rising stock market and home values have made consumers more comfortable spending most of their paycheck knowing that asset appreciation is doing the savings for them.
  • Still, steadily rising income helps employment growth, which in turn, boosts overall income. This positive feedback and cycles will continue. Demand for home purchases and commercial property spaces will be rising as a result.

Lawrence Yun, PhD., Chief Economist and Senior Vice President

Lawrence Yun is Chief Economist and Senior Vice President of Research at NAR. He directs research activity for the association and regularly provides commentary on real estate market trends for its 1 million REALTOR® members.

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  1. Lawrence

    How I shall I say this. We warned you about the inventory cycle, we told you that lending standards aren’t too tight that this is a DTI problem and liquid asset issue.

    Now look, prices rising faster than incomes, housing inflation much higher than CPI.

    Yet, still to this day you and many others are complaining that banks aren’t lending. I was on Bloomberg recently proving that Bernanke was 100% wrong and people like yourself are 100% because you have no counter argument. Say the same things over and over again without facts or data.

    Math, Data and Facts win at the end. Not spinning or being a salesmen.
    I know you see the numbers I see, DTI limits are going to be hit much faster than you anticipated. Normalization of rates will choke off buyers because income growth can’t stay on pace with rates and higher home prices.

    Inventory Crisis is your long term enemy here and as long as prices go up this much
    Mini Bubble, the less capacity buyers you will in the future because rates will not stay below 4% forever.

    Plus your affordability metric is outdated. Please get real, 20% down DTI 25 without taxes?