Here’s a chart of housing prices from the NY Times. I’m not entirely sure why it’s so extreme compared to the charts I put up in a previous posting. I suspect part of it is not using a log scale, part is having a much longer time horizon, part is that it’s showing a different index, and finally I suspect that it’s selective about what cities are included; but I still don’t really get it.
Pingback: A Duet in Rhapsody :: New York Times Housing Prices
Unlike those other charts this is inflation-corrected. Housing has largely traced the broader rate of wage inflation over the years — as it should, given that it’s always been a major portion of the average person’s income. Anything like housing or food that’s 20-30% of post-tax income naturally is going to have a growth rate that trends towards income growth over an long period — otherwise it would rapidly outgrow the ability of people to pay for it. (Unlike, say, the price of a cup of coffee.) That’s what’s so disturbing about this graph.
Pingback: Yummy Yummy » Graph of American house values from 1890 to the present
I believe that all the charts I have shown, including the Time’s chart are in constant dollars. The housing index charts are constant dollars converted onto the housing index.