Inflation adjusted Housing Prices by State 1991-2010

This is the second installment (by Matthew Mulbrandon and Catherine Mulbrandon) on Housing Price Index (HPI) by state in the United States. The first set of maps can be seen here. This new set is inflation adjusted and covers the entire span of the Federal Housing data set 1991-2010.

Much of the present debate on the future of the US economy has centered around Case-Schiller HPI and their suggestion that housing has historically risen with inflation (at least in their 20-city database). Of course context is everything so unemployment, income, urban development, housing supply, demographic change, other financial opportunity all play their part.

Housing Map inflation adjusted

HPI USA 1991-2010 (pdf)
Data source: Federal Housing Finance Agency

These maps give a nice snapshot into ground zero of the housing crisis in California, Nevada, Arizona, and Florida. Historically it would appear that California and Nevada are less prone to a further drop than fellow western states. Florida and Arizona, while up over the past twenty years, have not increased by much as compared with other parts of the country and both have had substantial population increases and are not fixed to the old industrial economy. Although it has been a bad decade for Michigan, it did well in the 90s and seems to fit in with fellow rust belt states of Ohio and Indian over the long term. State dominated by the megalopolis DC to Boston (while not having large increasing the 90s) have gone up substantially in the last decade. If this increase is justified remains to be seen. DC itself has gone up 112 percent and did not have the same decline in prices after the housing bubble burst as many other places (not shown on the scale). Louisiana probably had a larger increase in housing prices resulting from the destruction of the housing supply in 2005 by hurricane Katrina. The western states with large price increases have had large numbers of white/non Hispanics migrants from California as well as traditional immigrant groups Asians and Hispanics. It is also very urban, 90 percent or more, and the great plains states have weathered the recessions without much unemployment.

The value of owning a home is determined by the rent, increase over inflation minus depreciation 1.5 percent (estimated), taxes, insurance, although there are many tax brakes and financial incentives that homeownership brings. That along with increasing population of urban areas makes me think that housing will naturally increase faster than inflation in a growing economy like the US. The post below shows the difference between HPI methods in the last 20 years.

About Matthew Mulbrandon

I really like maps, as I am a geographer, and with the help of my more artistic partner I make cool maps. My focus in work and education has been centred on urban problems particularly housing and transportation. I have built and am working on several agent-based housing models. I am also interested in developing innovative ways to combat urban congestion using buses and electric kick scooters. Also it has led me to more theoretical pursuits such as how we determine if a model or methodology is sound (epistemology). How individuals relate to their social and built environment and their resulting interactions (social theory). Cities and really all our institutions are made of people with all their issues, virtues, and dreams and cannot be discounted when examining policy or predicting behaviours.

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