The size of the Median US house is rising faster than the median price.
People complain about rising property prices, but how many wonder also about what else rises in the same ratio?
There are three major components when looking at changes in median property prices.
- Property Price
- Property Size
Looking at data in the last 40 years, we compared 1975 and 2015
- In the United States, the median size of a new home, in 2016, is 2,467 square feet, 61% bigger than 40 years ago. Source: wsj.com
- In the United States, the median price for a new home was $270,200 in 2015, but $48,000 in 1975 Source: mybudget360.com
- In the United States, the median income was $51,759 in 2015, but $12,686 in 1975 Source: mybudget360.com
US Property Price comparison to Median Income:
- In 1975 a median priced house cost 3.78 times the median income
- In 2015 a median priced house cost 5.22 times the median income
From those figures we see that the real rise of the cost of housing is therefore 38% more than 40 years ago. (From 3.78 times to 5.22 times)
Compare that to the median house size which is now 61% bigger than 40 years ago.
And the answer is:
The Median US House is 61% bigger, but only costing an extra 38%, when compared to 40 years ago.
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