By Catherine Mulbrandon
Our homes have changed in many ways over the last 70 years, including homes size, building technology, family size and a rise in standard of living. As people's income increased over the 20th century, they bought bigger and better homes. This caused the median home value to go up even when taking into account the effect of inflation. For example, a full bath costs a lot since you need double plumbing for hot and cold water, while a flush toilet needs a home connected to a sewer system or septic tank.
In addition, housing costs include both land and the house; where building space in limited -- i.e. cities -- land will increase in value with population growth.
Median home value calculated by the U.S. Census factors in all of these changes and covers the housing markets in both rural and urban areas. The historical price index created by Robert Shiller, however, looks at home prices as an investment (like stocks), focusing on the resale prices of a subset of the standard, unchanged houses in large metro areas.
Visualizing Economics is a website by Catherine Mulbrandon dedicated to publishing infographics about economic data. Visualizing Economics has been featured at Slate.com, NPR.org, WashingtonPost.com, The Big Picture, Seeking Alpha and on MSNBC
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- Data Source for Housing Price Index from Robert Shiller's Irrational Exuberance
- Median Home Values: Historical Census of Housing Tables Home Values; "An Approach for Calculating Reliable State and National House Price Statistics"
- Characteristics: Housing Characteristics In The U.S. and Median and Average Square Feet of Floor Area