74 Years of Home Prices: The Economic Rollercoaster You Need to Know About

Real estate and economics are closely linked, and when you combine the two, it’s fascinating to look at the trends over time. A friend of mine—who happens to be an economist—gets hilariously frustrated when people start asking me questions about the market while he’s standing right there. I mean, I’m a realtor, not an economist… but the two worlds overlap more than you'd think!

So, what if we take a step back and look at the historical data? I recently came across a chart showing home price trends in the U.S. from 1950 to 2024. However, it’s important to note that the Case-Shiller Home Price Index, which is often considered the most reliable source for tracking U.S. home prices, officially starts in 1987. The earlier data (1950-1986) comes from a variety of other sources, such as the U.S. Census Bureau and academic research, but the Case-Shiller data from 1987 onward provides the most consistent and detailed record of home prices.

Now, here’s the striking part: over the last 37 years (from 1987 to 2024), home prices have increased nearly every single year—except for just seven!

That’s right. Out of the past 37 years, home prices only didn’t rise in the following years:

• 1990-1991

• 2007-2011

• 
  

These years are marked on the chart, and when you look at the rest of the data, it’s clear that home prices have followed a steady upward trend.

Now, let’s break down what this really means for homeowners and investors. The fact that home prices have generally been increasing for over three decades shows that, in the long run, real estate tends to appreciate. We’ve seen it again and again—whether it's a housing boom in the early 2000s or a post-recession recovery in the 2010s—prices tend to bounce back.

But, of course, this doesn’t mean the market is immune to downturns. The years 1990, 1991, and 2007 to 2011 were periods of economic or housing crises that affected home values. The late 2000s housing crash, in particular, was a tough time for real estate, and it took years for the market to recover. Even in the more recent pandemic era, we saw some fluctuations, but the long-term trend remains clear.

So, should you take this history into account when making decisions about buying or selling your home? Absolutely. If you’re a homeowner or considering investing, it’s important to keep in mind that real estate has historically been a solid investment in the long run. But just because prices have increased consistently doesn’t mean there won’t be short-term dips or changes in the market.

The question becomes: What’s your strategy? Are you in it for the long haul? Or are you looking for short-term gains? While no one can predict the future of the housing market, history tells us that real estate has a strong tendency to recover and appreciate over time. So, while there may be some ups and downs along the way, most of the time, buying a home is a solid bet for your financial future.

What do you think? Are we in for another long period of price increases, or do you think the trend is about to change? I’d love to hear your thoughts in the comments!

Sources: Case-Shiller Home Price Index data from 1987 onward: S&P CoreLogic Case-Shiller U.S. National Home Price Index, published via the Federal Reserve Economic Data (FRED) platform. Earlier historical data compiled from various academic and market research sources.