Housing is tricky because most individuals do not pay the marginal rate. There are many individuals who last bought a house decades ago, are locked into rent-control, or have fortunate landlords who don't push the rent to the marginal rate.
Unfortunately this means that if housing is inflating it punishes the portion of the population susceptible to the marginal rates which in the long-run will be everyone. It would be great if there was a "marginal" CPI which highlighted the changing prices of capital assets.
Unfortunately this means that if housing is inflating it punishes the portion of the population susceptible to the marginal rates which in the long-run will be everyone. It would be great if there was a "marginal" CPI which highlighted the changing prices of capital assets.