Social Sciences History Seminar

Abstract: We chart the evolution of housing prices in American cities across the twentieth century using millions of real estate listings from newspaper archives. Using hedonic methods, we construct the first market price indices for both rented and owned housing that reflect yearly market conditions for the 1890-2006 period at both the national and city level. The resulting indices, which overcome many of the limitations of existing sources of price information, allow us to document several new facts about housing markets. First, we find that real market rents only increased by about 15 percent between 1890 and 2006. Second, there was greater growth in housing prices than has been previously understood, with home prices rising faster than inflation in the 1920s, 1960s, 1970s, and 1990s. Third, the capital gain associated with housing ownership has exhibited substantial heterogeneity across cities but was close to zero nationally before World War II. Finally, we show that housing prices increased unevenly across space and time partly in response to natural building constraints and, in the postwar period, to regulatory constraints.

Written with Ronan Lyons, Rowena Gray, and David Agorastos.