Watch the video below to learn about home prices during inflation in Orange County:
- Is residential real estate a good inflation hedge in Orange County? I’m going to be showing you what happened to home prices during the highest inflation years in recent history. You will see that Orange County homes appreciated at the fastest rate during years of high or growing inflation. I’m Tim Hamilton with StellarQuest Real Estate. If you enjoy watching this video, please help me about by hitting the “like” button below and subscribe if you like to stay informed on the housing market.
- Many people have either experienced or heard about the high stagflation years we had in the 70’s and early 80’s. Stagflation is when you have rising prices mixed with low or no economic growth. During these years we had some of the highest price growth years, and consistently grew faster than the average 7.7% price appreciation.
- 1973 we had CPI of 6.2% and price appreciation of 10.9%.
- 1974 we had CPI of 11.1% and price appreciation of 21.9%.
- 1975 we had CPI of 9.1% and price appreciation of 15.4%.
- 1976 we had CPI of 5.7% and price appreciation of 24.2%.
- 1977 we had CPI of 6.5% and price appreciation of 27.5%.
- 1978 we had CPI of 7.6% and price appreciation of 15.7%.
- 1979 we had CPI of 11.3% and price appreciation of 15.2%.
- 1980 we had CPI of 13.5% and price appreciation of 14.7%.
- 1981 we had CPI of 10.3% and price appreciation of 10.3%.
- 1982 we had CPI of 6.1% and price appreciation of 1.8%.
- 1983 we had CPI of 3.2% and price appreciation of 10.4%.
- Now looking at the late 1980’s
- 1987 we had CPI of 3.6% and price appreciation of 13.3%.
- 1988 we had CPI of 4.1% and price appreciation of 17.1%.
- 1989 we had CPI of 4.8% and price appreciation of 17.9%.
- 1990 we had CPI of 5.4% and price appreciation of 3.7%.
- 1991 we had CPI of 4.2% and price depreciation of 4.0%.
- I got the CPI numbers from the St. Lous Federal Reserve website, and the price appreciation numbers came from a variety of sources that track the median home price in Orange County since 1971. I will leave those sources in the description.
- What we’re looking at is a chart I made that graphs the Consumer Price Index in red, which is measure on the left axis. The blue line is the percentage gain or loss in the median Orange County home price, which is measured by the right axis. You can see the relationship isn’t perfect, but during years of high or rising CPI numbers we also had high home price appreciation. However, from 1998-2005 we had many years of very strong price growth with relatively low inflation numbers. And finally, you are probably aware of the large price increase we had in 2021. Unfortunately, the CPI data wasn’t available for 2021, but we know that it was a year with growing CPI numbers and the highest inflation in 40 years.
- If you enjoyed watching this video please hit the “like” button below and subscribe if you like to stay up to date on the housing market. If you’re thinking about buying or selling a home feel free to contact me anytime, you can find all my personal information in the description below. If you’re in Southern California I can personally help you out, and if you’re out of my area of expertise I can refer you to an experienced agent in your area.
Below are a few interesting charts related to housing market values:
Stocks vs. Home Values: https://www.longtermtrends.net/stocks-to-real-estate-ratio/
Home Values vs. Median Income: https://www.longtermtrends.net/home-price-median-annual-income-ratio/
Home Values vs. Inflation https://www.longtermtrends.net/home-price-vs-inflation/
Get More Real Estate News: https://stellarquest.com/category/news/
StellarQuest Real Estate – Lic #02077900
www.StellarQuest.com Video
By: Tim Hamilton
Broker Associate
Lic# 01959966
(714) 486-4086
timsellsca@gmail.com