U.S. Housing Market in 1978

1978 was the high-water mark of the inflation-era housing boom. Existing-home sales hit 3.99 million, new-construction sales held at 817K, and combined transactions reached 7.99M — a level the U.S. would not match again for 20 years.

The post-war housing engine was running at full speed. Median existing-home prices crossed $48,700 — up 22% in two years — as the baby boom hit peak first-time-buyer age and rising inflation made real-asset ownership feel essential. The 30-year mortgage averaged 9.64%, already painful by historical standards. What buyers did not yet know: Paul Volcker would take the Fed chair the next August, and the 16.63% peak rate of 1981 would erase more than half this year's transaction volume in three years.

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