Short answer. U.S. median existing-home prices have risen from $20,100 in 1968 to $408,000 in 2024 — a 20.3× nominal increase over 56 years, or roughly 5.5% compounded annually.
Compound annual growth in median existing-home prices from 1968 to 2024 was 5.51% nominal. Over the same period:
- Consumer Price Index: 4.0% nominal CAGR
- S&P 500 (with reinvested dividends): ~10.7% nominal CAGR
- Median household income: ~5.0% nominal CAGR
So in real terms
Median existing-home prices grew roughly 1.5% per year above inflation. That's positive but not as dramatic as the nominal headline. The "homes only go up" narrative comes from leverage: a 20%-down buyer with 1.5% real appreciation gets ~7.5% real return on their equity (before maintenance and transaction costs).
The decade breakdown
- 1968 → 1978: 8.6% CAGR (high inflation era)
- 1978 → 1988: 6.3% CAGR
- 1988 → 1998: 3.7% CAGR
- 1998 → 2008: 4.4% CAGR (subprime cycle)
- 2008 → 2018: 2.9% CAGR (recovery from crash)
- 2018 → 2024: 7.7% CAGR (pandemic surge)
What this means for individual returns
A buyer who purchased the median home in 1968 for $20,100 with 20% down ($4,020 of equity) and held to 2024 captured the full 20.3× nominal appreciation. The home is now worth $408,000; the original $4,020 of equity has grown to $408,000 minus any remaining mortgage balance. Even ignoring the leverage effect entirely (a paid-off home, returning the appreciation only on the original down payment), the 1968 buyer earned approximately 8.6% nominal CAGR on equity across 56 years — comfortably above the long-run S&P 500 dividend-only yield, though below the S&P 500's total return. Once leverage is included on a 30-year-amortizing buyer, equity returns from a 1968 entry comfortably exceeded equity-market totals over the same span.
However, that compounding includes two extraordinary periods (1968–1978 inflation-driven appreciation and 2018–2024 pandemic surge) and one major drawdown (2007–2011). A buyer who purchased near the 2005 cycle peak and sold near the 2011 trough would have lost roughly 25% nominal — turning paper gains into realized losses on any sale during that window. Long holds smoothed this; short holds did not.
The transaction-cost adjustment
Real returns to homeowners are also dampened by transaction costs (~6% on the sale via realtor commissions, plus title and closing fees), property taxes (~1% annual), maintenance (~1% annual rule of thumb), and forgone return on the down payment if invested elsewhere. After all adjustments, the post-1968 net real return on owner-occupied housing is closer to 0.5–1.0% per year for the median household — positive but modest, with the bulk of the wealth-building benefit coming from forced savings (mortgage amortization) rather than price appreciation per se.
Related
- Median U.S. home price in 2024
- U.S. housing price-to-income ratio
- When was U.S. housing most affordable?
- How much did home prices fall after 2008?
- Median home price history dashboard
Sources
U.S. Census Bureau Survey of Construction; National Association of Realtors Existing Home Sales report; Freddie Mac Primary Mortgage Market Survey; National Bureau of Economic Research Business Cycle Dating Committee.