A chart showing a fascinating historical perspective of the current housing crisis.

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by rthomas6 • 18 years ago

7 13 18 years ago

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The natural trend for housing prices should be down, as technology makes equivalent houses cheaper to buy, and better transportation infrastructure (in theory) increases the supply of viable housing.

netcan3• 18 years ago

Not disagreeing with you on the general idea but there are other factors pushing up. Mostly to do with rising population. 'Existing' houses stand in places that will over time become more central, more developed & therefore more scarce.

pg2• 18 years ago

These are both good points. I was wondering why the supposed trend was so flat. The answer is that there are so many other random factors pushing in both directions that there probably is no real trend.

It would probably be more reliable to predict the bottom by looking at the ratio of house prices to income. That shouldn't change too fast.

time_management3• 18 years ago

Any location can become desirable. As the population rises, so does the supply of desirable places to live. Chicago and San Francisco weren't even on the map two centuries ago. Within the U.S., differences in levels of "excitement" and cultural amenity between cities are narrowing due to modern technology, to the point where the decision of whether to live in New York, Chicago, Seattle, or Minneapolis has more to do with personal tastes and situations than with one city being more desirable.

As for existing houses becoming more central, I tend to disagree that this is inevitable. Many suburban and exurban houses are going to be abandoned as oil becomes scarce. Many towns and locations have died instead of developing. We tend to assume that existing houses will age well, but this is driven by survivor bias as we forget about those that are abandoned and die.

As for the long-term influence of population trends, if the population continues to grow, it will be too large for the planet's resources long before we run out of physical space.

CatDancer• 18 years ago

Sure, for the same amount of house, other factors being equal. But that doesn't mean that the prices people pay for houses goes down, even if other factors stay equal, because people buy larger houses with more features for their money.

ph0rque• 18 years ago

It would be interesting to see the same graph broken down by house and land prices.

thwarted• 18 years ago

Buh, there is an extra tick mark between 2000 and 2010.

A chart showing a fascinating historical perspective of the current housing crisis.

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