The rate of growth of new home sale prices in the U.S. has slowed significantly from historic rates. The following chart shows one of our favorite ways to measure that growth rate, tracking the amount of time it has taken for the median new home sale price in the United States to double since January 1963, the earliest that monthly data for the statistic is available.
Starting from January 1963, the median sale price of a new home sold in the U.S. has sustainably doubled four times, with the amount of time it has needed taking 134 months, 104 months, 167 months, and 217 months to do so, with the most recent doubling period ending in October 2014.
In the next chart, we've zoomed in on the period since January 2000 for average and median new home sale prices, where we find that new home sale prices hit a peak in December 2017 before slowly declining in the months since.
What makes this period different from earlier periods where new home sale prices have declined is the absence of recession. In fact, median household income has been generally rising after adjusting for inflation since the end of 2016, where the combination with falling median new home sale prices means that new homes have been becoming more affordable in the U.S. The following chart shows the ratio of the trailing twelve month averages of median new home sale prices and median household income since 1967.
For the affordability of new homes sold in the U.S., the last two years have been unique among all the years in the last five and half decades for which we have data.