Do Home Prices Always Go Up?

Housing Data Summary - Past 82 years

Info on this home here

57 years of real estate price data is shown in the chart above. A guy like Ray Dalio, might say that’s not a long enough timeline…

75-100 years is the length of a big debt cycle according to Dalio, following his recent research on the last 500 years of world economies.

Who’s Ray Dalio and why should you listen? He’s the founder of the largest and most successful hedge-fund in history, Bridgewater. Most recently he wrote several books under the heading, Principles, where he shares a lifetime of financial intelligence with anyone who’s willing to listen. If you’re not into books, he’s made some easy to understand videos on How our economy works and other compelling economic topics.

Back to the chart… above is a standard issue economic data chart released by the Federal Reserve Bank of St. Louis, and it’s great to have this data set… but what if we wanted to go back further than 62 years?

The US Census said this, “Median home values adjusted for inflation nearly quadrupled over the 60-year period since the first housing census in 1940.” There’s an awesome table showing median home values adjusted for inflation 1940-2000. The unadjusted table can be reviewed here and is also summarized below.

Median Home Prices 1940-2000 (US Census)

At the time of this article it’s been 82 years since the first census data release on this topic. Are we due a reset? What would the end of a debt cycle look like? Would real estate take a permanent loss in values?