One of the neater blogs I've recently encountered is The Real Returns, which offers a wealth of investing, market and economic data. Earlier this month, The Real Returns posted data related to the recent history of U.S. median house prices over the period from 1963 to 2004. The original source of the housing data is the U.S. Census Bureau.
Well, that kind of data deserves some curve-fitting and a calculator to estimate what the future U.S. median house price might be, so Political Calculations has extracted the data from 1973 onward to create the following chart:
The corresponding tool that may be used to estimate the future level of Median House Prices in the United States follows:
About the Tool
Originally, Political Calculations used the entire dataset from 1963 to 2004, but found that including the earlier 10 years shifted the curve too far upward to correspond well with the actual data in more recent years. Omitting the ten years from 1963 to 1973 tended to minimize the discrepancy, but setting 1973 as the starting year was done arbitrarily - it may be possible to find a better fitting curve through more trial and error.
Overall, the median house price in the U.S. appears to have grown at an average annual rate of 5.5%, at least since 1973.
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