Home Price Gains in the Context of Inflation
Scott P. Rogers
There are lots of ways to evaluate home prices in our area these days based on the data set that we select...
- All home sales
- Just detached home sales
- Just resale homes
The data above looks at just detached, resale homes. Doing so accomplishes two objectives...
- The median sales price isn't affected by how many detached vs. attached homes are selling in any given year.
- The median sales price isn't affected by how many new homes vs. resale homes are selling in any given year.
But... one last layer to consider is how these home price changes look when put in the context of inflation.
Here are the latest inflation rates that are based on changes in the U.S. annual Consumer Price Index...
- 2023 = 4.1%
- 2024 = 2.9%
- 2025 = 2.6%
- 2026 = 3.5% (estimated)
Here, then, are how those changes in median sales price look when accounting for inflation...
- 2023 = 2.2% increase (6.3% - 4.1%)
- 2024 = 8.9% increase (11.8% - 2.9%)
- 2025 = 0.6% decrease (2.0% - 2.6%)
- 2026 = 0.3% decrease (3.2% - 3.5%)
So... has the median sales price been increasing over the past two years? Yes, nominally... in actual dollars... but once we account for inflation... prices have actually inched down a bit.
