Housing prices have skyrocketed amid the coronavirus pandemic and the inflation of the ensuing economic recovery, climbing more than 30 percent since 2020, exacerbating a decades-long upward trend.
Median housing prices in the first quarter of 2020 were at $329,000, but reached $428,700 by the first quarter of this year, according to data from the US Census Bureau and the Department of Housing and Urban Development, which The Hill retrieved from FRED, the Federal Reserve Bank of St. Louis.
Since 2000, median home prices in the US have increased by nearly 160 percent.
Here’s a closer look at the rise — and occasional fall — of housing prices in America over the last two decades.
Start of the century:
In the first quarter of 2000, the median price of a house was $165,300, rising to $169,800 in 2001 and increasing more significantly to $188,700 by the first quarter of 2002.
Median prices surpassed $200,000 by the beginning of 2004 and continued a fairly steady rise until the first quarter of 2007. At that time, median prices held at $257,400.
2008 economic crisis:
But then prices began a sharp decline as the economy neared the Great Recession.
“The housing boom of the mid-2000s contributed to a rapid expansion of supply, while the housing crash and ensuing Great Recession of 2007-2008 resulted in an increase in the number of vacant units,” Evan Brassell, chief of housing statistics for the Census Bureau, previously explained when data on the decline in housing unit growth between 2010 and 2020 was released.
By the first quarter of 2008, median house prices had fallen to $233,900 and later dipped to the lowest median price since 2003, hitting $208,400 by the beginning of 2009.
Recovery from collapse:
By the end of 2009 and into the next decade, median home prices rose consistently.
From there, the 2010s began not long after what was the beginning of modern American history’s longest consistent economic growth period from June 2009 to February 2020.
In the first quarter of 2011, home prices averaged $226,900. That figure stood at $238,400 in 2012, $258,400 in 2013, $275,200 in 2014 and $289,200 by 2015.
Over the next several years, home prices grew by roughly $10,000 per year. They briefly fell around 2019, when prices dropped to $313,000 from $331,800 in the first quarter of the previous year.
To COVID-19 market:
In the first quarter of 2020, just ahead of the COVID-19 pandemic shutting down much of the global economy, median home prices were $329,000.
But since then, prices have dramatically shot up, reaching medians of $369,800 in 2021’s first quarter and $428,700 in 2022.
Those prices mark an increase of nearly 80 percent in the past 10 years.
Additionally, current prices are just over 30 percent more than they were in 2020 and have increased by almost 16 percent since just last year.
The spiking home prices have also contributed to an increase in prices in the rental market as more people who may have previously considered buying a home have looked to rent instead.
“As the rental market gets more competitive and brings in more higher income households, the folks who feel this the most are obviously folks on the lower end of the income spectrum whose incomes have not been rising as quickly as prices,” Rob Warnock, a senior research associate at Apartment List, previously told The Hill.
Last month, government-supported mortgage giant Fannie Mae predicted that inflation and other economic factors could contribute to a possible “modest recession” in 2023.
At that time, Doug Duncan, Fannie Mae senior vice president and chief economist, said he expected home sales, house prices and mortgage volumes to drop over the next two years.
“In particular, we expect house price growth to slow down to a more consistent pace with income growth and interest rates,” he said.