How U.S. Homes Are Hurt by Rising Energy Prices

(Bloomberg) — Soaring energy prices have literally hit home.

Although it wasn’t always true in the past, crude-oil and gasoline prices, along with higher financing costs and decreased affordability, may have pushed the U.S. housing market into a palpable decline.

With crude-oil prices leaping past $77 a barrel, a conflict escalating in Lebanon, supply concerns exacerbated by hurricane threats, Nigerian pipeline sabotage and a civil war in Iraq, there doesn’t seem to be an end to the global energy anxiety.

Rising fuel costs often translate into higher mortgage expenses as the Federal Reserve raises short-term rates to squelch inflation. Already approaching rocky shoals, the housing market is imperiled by gasoline prices climbing 6.3 percent in the producer price index last month alone.

Bloomberg