Economist: No housing bubble

The Economist took a look at Standard & Poor’s housing data and concluded that there probably isn’t a housing bubble at the moment. And when you see the charts you can see why.

For example, if you start at the end of 1987 (giving it a value of "100"), here is what real house prices look like.

image

As we’ve mentioned before, when you adjust for inflation, home prices tend to stay about the same — at least that’s what Shiller found when he looked back to the late 1800s. If you were to extend this graph back, you’d see prices usually bounced around near that 100 mark.

So now we’re back there, after enduring the bubble of 2000 to 2008. Ergo, we’re not in a bubble.

About Andrew Kantor

Andrew is VAR's editor and information manager, and -- lessee now -- a former reporter for the Roanoke Times, former technology columnist for USA Today, and a former magazine editor for a bunch of places. He hails from New York with stops in Connecticut, New Jersey, Cincinnati, Columbus, and Roanoke.
This entry was posted in The Buzz. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *