U.S. Housing Market in 1971

In 1971, the U.S. housing market recorded existing-home sales averaged 2.02 million, new-construction sales of 656K, and a 30-year fixed mortgage rate of 7.54%.

Existing-home sales rose 25.5% from 1970. the median existing-home price rose 7.8% to $24,800.

Macroeconomic Context

Nineteen seventy-one produced one of the most dramatic policy pivots of the postwar era. The economy rebounded from recession, with real GDP growing roughly 3.3%, but inflation stayed stubbornly above 4% and the trade balance deteriorated sharply. On August 15, President Nixon announced the "Nixon Shock": the U.S. closed the gold window, ending the Bretton Woods fixed-exchange-rate system, and imposed a 90-day freeze on wages and prices — the first peacetime price controls in U.S. history. The dollar's subsequent devaluation fueled import prices and added a new source of inflationary pressure.

The Fed, under new chairman Arthur Burns, accommodated the stimulus-focused White House, keeping monetary policy relatively easy. Mortgage rates moderated from their 1969–70 peak to around 7.5%, and Freddie Mac's new conventional mortgage purchase program — combined with Ginnie Mae's mortgage-backed securities — began deepening the secondary market. This was also the year Freddie Mac launched the Primary Mortgage Market Survey (PMMS), providing for the first time a systematic weekly benchmark for 30-year fixed mortgage rates that the industry and researchers still use today.

The easier credit environment, combined with pent-up demand from the 1969–70 recession, kicked off a strong housing recovery. New-home sales climbed sharply from their 1970 lows, and starts surged toward record levels. Wage and price controls temporarily suppressed measured inflation, but they also created distortions in construction material markets that would contribute to cost pressures when controls were eventually lifted.

See also

• The full 1963–2024 data table
• 30-year fixed mortgage rate history
• Median home price history