I know this chart is hard to read, but I felt I had to share it. I saw it about a week ago and haven’t been able to get it out of my mind.

The chart is an index of American housing prices going back to 1890.  It is based on sale prices of standard exisiting homes, not new construction.  It shows housing prices in today’s money.

The second shaded area is the Great Depression.  The fourth and fifth shaded areas are the booms during the 70’s and 80’s respectively.  The last shaded area is the current boom.  Wow.  Check that out!

The important thing to notice is that after each boom, or depression, the average standard house price returns to levels that have been consistent since the 1950s.  The dotted line is an estimation of future housing prices.  The last year listed on the bottom is 2013.  So according to the chart housing prices won’t reach bottom until about 2017.

Gulp!

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