Shelter Inflation Slows Slightly But Housing Market Remains Tight

Despite higher overall inflation, shelter inflation slowed in January on a year-over-year basis, rising 6% vs 6.2% in December.

The shelter component rose due to hotels and motels, not rents, signaling continued strong housing demand.

Experts expect shelter inflation to continue falling, potentially to around 3% by next year.

Rent measures don't reflect real-time conditions as data is backward-looking; rents haven't fallen as fast as expected.

Tight housing market will keep home prices high, influencing rents as people who can't buy turn to renting.