- Home prices have risen at 2.4 times the pace of inflation since the 1960s, a study from Clever Real Estate found.
- Should the trend continue, the median home price will cost 8.4 times the median household income by 2050.
- "Homeownership has always been costly, but historically, it has never been this costly."
Home prices have zoomed past the rate of inflation for other goods in the US since the 1960s.
According to a study by Clever Real Estate, housing prices in the US have risen at 2.4 times the pace of inflation since the 1960s.
"If home prices had merely kept pace with inflation, the median home would cost only $177,500 today — compared to the $431,000 it actually costs," Matt Brannon, the report's author, said.
The trend holds if the timeline is narrowed, too. Since 2013, inflation has clocked in at 31% while the median home price has risen by 63%.
"Homeownership has always been costly, but historically, it has never been this costly," Brannon wrote.
The impact is especially stark when comparing the homebuying prospects of the two largest generations in the US: baby boomers and millennials.
Homes are almost twice as expensive for the younger cohort than they were for boomers in their 30s when adjusted for the typical income, the report said.
That means that Americans are having to shell out a larger and larger chunk of their pay towards buying a house. In the 1980s, it took roughly 3.5 years' worth of household income to purchase the typical home, the study said, but that number has ballooned to 6.3 years' worth of household income today.
A separate Zillow survey found that homeowners need to earn 80% more to comfortably afford a home than they did just four years ago.
Stoking the surge in home prices has been a massive supply crunch, with a shortage of 3.2 million homes, Clever noted. In many cases, single-family homes that are being built are bigger and more expensive, while much of the new construction otherwise is concentrated in the rental market.
If the pricing trend continues, by 2050, the median home price will cost 8.4 times the median household income, the Clever report said.
