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Comment by Finnucane | Hacker News Reader

Now do price-to-income ratio over the same time.

10x-15x+ price to median income is common in many desirable areas. Completely ridiculous, but also what you might expect after a decade+ of QE, asset inflation, and the last four years of core inflation.

Still not that bad comparing to other countries, like those in EU.

To say nothing (apparently) of decades of allowing the wealthy to absorb most of the created wealth of the last few decades.

I think about this and wonder if it's supported by data.

I wonder because no one speaks about the poverty created by the last few decades, which might contradict what you wrote, or might not. I also wonder where one could track creation of wealth and creation of poverty.

(living outside income, for example, i think of as creating poverty)

That's because "desirable" areas aren't fixed over these timescales. Today's gated suburbs in the Bay Area were literally dust bowl farms in 1950! Like, literally Steinbeck wrote a famous novel about it.

Steinbeck's books were mostly late-30s, no? Which one are you thinking of? Grapes of Wrath is mostly around Bakersfield, Cannery Row and East of Eden are Monterey/Salinas Valley. I'm not sure of anything set that far north.

I have family photos from back in the 50s showing lots of good orchards in the Bay Area. Certainly no dust bowl stuff. If I remember correctly, my grandparents bought their 5BR tract house in Santa Clara in the mid-1950s for somewhere around $15 or $16k, which was ~40% more expensive than the median California house back then. The Bay Area has always been expensive!!!

Ooph, HN is being HN. The point is that California was not remotely exclusive or expensive in the mid-century, it was a target of emigration from the rest of the country for its relative affordability and low density. The point to citing Steinbeck wasn't to claim he wrote about Silicon Valley in particular, it was to show that this effect was well-known to basically everyone at the time.

I mean, no, "good orchards" aren't desirable homes, by definition. There's at least an order of magnitude delta in real estate price between the two! And sure, your family found a very nice neighborhood in the south bay. That doesn't mean that South SF wasn't a dump or that Fremont wasn't completely uninhabited.

Because my upthread point was, and remains, that you can't look at the history of "desirable homes" over a 75 year scale because by definition desirability changes much more frequently.

The longest history I could find using FRED data is this: https://fred.stlouisfed.org/graph/?g=1BPi3. So median house price to family income rose from 2.9 to 4.3 between 1963 and 2003, based on the series https://fred.stlouisfed.org/series/MEFAINUSA646N and https://fred.stlouisfed.org/series/MSPUS.

Getting long historical series of economic data is often a challenge due to changes in definitions and sampling methodology over time. FRED has a bewildering array of both income and house price series, all with subtly different definitions, most with pretty short histories.

Yes, comparing to median household income is the right way to do this. CPI isn’t actually useful in this case.

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