Retail sales correlate with home prices
Today, the released its showing an increase of 0.2% from June, and a gain of 5.4% on a year-over-year basis on an aggregate of all items including food, fuel and healthcare services.聽
Nominal "discretionary" retail sales including home furnishings, home garden and building materials, consumer electronics and department store sales, on the other hand, declined 0.1% from June but still increased 2.61% above the level seen in July 2012 while, adjusting for inflation, 鈥渞eal鈥� discretionary retail sales declined 0.1% on the month and increased 0.80% since聽July 2012. 聽
On a 鈥渘ominal鈥� basis, there had appeared to be 鈥渞ough correlation鈥� between strong home value appreciation and strong retail spending preceding the housing bust and an even stronger correlation when home values started to decline.聽
