Income and Home Price Comparison over 50 years

[Shawn Parsh]

I find it interesting that the median household income in the U.S. in 1974 was 11,100 and was 74,580 in 2022. That is about a 670% increase in income over the roughly fifty years. The median home price was 34,200 in 1974 and 434,000 in 2022. That is about a 1,269% increase in the price of a home in the same time period. The median home price cost went up by almost double the increase in income. Does that imply that home prices are going to adjust lower?? What it does tell me is that our dollar has lost a lot of its value over the years, yet we continue to pass budgets that continue our debt cycle. 

[Theresa Harris]

Quote from @Shawn Parsh:

Theresa,

  I appreciate the input and you are 100% correct. My thesis for my Masters Degree involved the risks involved with the U.S. electric grid, but part of that research looked into the amount of electric required by the average American. My research highlighted how the average size of a home in the U.S. went way up over the years. I'm not sure what changed that meant we needed so much more space, but it is the new reality for most. 

 I don't think we really need so much more space, we want it and many people simply have too much stuff.  I look around my neighbourhood and see most people with garages park in their driveway or on the street because their garage is full of stuff (ie used as storage) and they have 3-4 cars per household.

I really don't know what changed the mindset. I am around a lot of university students and see them complaining about not having enough money while drinking starbucks coffees and buying their lunches while those who are not students bring their own lunch and make their own hot drinks.  Different choices and lifestyles.