Home Price Appreciation Over the Last 20 Years

The monthly Case Shiller home price index was reported today.  It showed that in the 20 cities that make up the broad index, house prices were down 3.8% y/y.  This means that home prices are back to 2003 levels according to this index.

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Looking at the above chart, it's clear that home prices haven't changed much for the last couple years.  Over the last 20 years though, home prices have still appreciated significantly.  Below is a comparison of annualized home price increases over the last 20 years.  Interestingly, the S&P 500 has handily beaten the returns on owning a home over that time period.

Home Price Increase Over the Last 20 Years (Annualized)