{"id":1952,"date":"2021-08-11T14:00:12","date_gmt":"2021-08-11T14:00:12","guid":{"rendered":"https:\/\/phphouses.com\/blog\/?p=1952"},"modified":"2021-08-11T14:00:12","modified_gmt":"2021-08-11T14:00:12","slug":"houses-less-affordable-past-decades","status":"publish","type":"post","link":"https:\/\/phphouses.com\/blog\/houses-less-affordable-past-decades\/","title":{"rendered":"Are Houses Less Affordable Than They Were in Past Decades?"},"content":{"rendered":"
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Are Houses Less Affordable Than They Were in Past Decades?<\/p><\/div>\n

There are many headlines about how housing affordability is declining. The headlines are correct: it\u2019s less affordable to purchase a home today than it was a year ago. However, it\u2019s important to give this trend context. Is it less expensive to buy a house today than it was in 2005? What about 1995? What happens if we go all the way back to 1985? Or even 1975?<\/p>\n

Obviously, the price of a home has appreciated dramatically over the last 45 years. So have the prices of milk, bread, and just about every other consumable.\u00a0Prices rise over time<\/em>\u00a0\u2013 we know it as\u00a0inflation<\/strong>.<\/p>\n

However, when we look at housing,\u00a0price<\/strong>\u00a0is just one component that makes up the monthly\u00a0cost<\/strong>\u00a0of the home. Another key factor is the mortgage rate at the time of purchase.<\/p>\n

Let\u2019s look back at the\u00a0cost<\/strong>\u00a0of a home over the last five decades and adjust it for inflation by converting that cost to 2021 dollars. Here\u2019s the methodology for each data point of the table below:<\/p>\n