Fascinating graph of visual capitalist showing the history of real estate prices in the United States.
I remember the house price recession of 1990 – I was too broke to afford a condo, but I knew lots of friends who had recently graduated who took high paying jobs and bought homes in the 1980s; more than a few panicked about the price crash.
The problem with rising prices is the continued shortage of single-family homes relative to population and employment locations. THE calculation error is part of the reason why prices have remained so high; add a lot of people who might be considering moving but don’t want to give up their 3% or 4% mortgages and you have a recipe for a limited supply. This has led to high house prices and inflated, sticky apartment prices (although there are growing signs that rental prices may have peaked).
Looking at prices since then shows that their concerns have proven to be somewhat misplaced. While hindsight is still 20/20, the chart reveals how little we know about what the future holds.
FMH vs. RTO (February 16, 2023)
Can we dissociate real estate and employment? (March 21, 2022)
How everyone miscalculated housing demand (July 29, 2021)