(Replying to PARENT post)
A $150k loan in 1999 at 7.6% would cost you $1,059/mo in mortgage payment. A $300k loan at 4% today will cost you $1,432/mo - a 35% increase over the original price, not the 100% you'd expect. Meanwhile, you aren't paying 2x per square foot - you're getting roughly twice as much house as you did before for that price, for only a 35% increase in payment!
[1] This is a smallish dataset, but the trend holds outside of the pre-2008 runup. I don't have that data immediately on hand, though. https://www.clevelandfed.org/newsroom-and-events/publication...
(Replying to PARENT post)
For example the UK's GDP per capita has increased by ~120% since 1993. Median incomes in the UK have likely doubled or nearly so since the early 1990s. A lot of that is inflation, just as is the case in the housing price increases.
The US median family income has nearly doubled since the early 1990s - before you account for inflation.
If you take the median new home sale price in the US, and adjust it at 3% annual inflation over the last 15 years, housing prices are not much higher than they were in 2003. There has been maybe at worst a 10-15% real increase in housing prices in 15 years. Factor in the relative scarcity of construction since the great recession, due to fear, and that one issue alone can easily account for 100% of all real housing price gains re the national median.
The primary problem of the last 15-20 years for the average person, both in the US and most of Europe, are that the central bank inflationary (currency & debt debasement) programs are outpacing the rate of income gains. The US saw an epic standard of living debasement with an extraordinary destruction of the dollar from 2001-2008. That's the US Government spending + Fed causing that harm.
Google these: Czech GDP, Poland GDP, Russia GDP, Colombia GDP, Bolivia GDP, Turkey GDP, Indonesia GDP
Now, did Czech GDP really increase by ~300% (lol) in seven years, from Jan 2002 to Jan 2009? From $67b to $235b. No, obviously not. You'll see similar hilarious GDP gains in most every other nation at exactly the same time - when priced in dollars.
That's a representation of the destruction of the US dollar over that time, by the US Government and the Fed. You can also see it represented in eg oil, gold and many other commodities priced in dollars. So you can imagine the destruction of the US standard of living that occurred at the same time, which has now given us Trump as President and an endlessly pissed off electorate. The US isn't unique however, France is partying right now to that exact same situation, decades of real stagnation against horrific government and central bank policies that are wiping out average people.
Good luck seeing wages keep up with the destruction the monsters in DC have been causing via real inflation. Most of the real estate price gains over the last 20 years in the developed world are fake, they're nothing but inflation. The problem is that wages are not keeping up with that inflation.
(Replying to PARENT post)
"In the past two decades house prices have doubled in real terms"
Then saying: "Most empirical work shows that a 1% rise in the housing stock leads to a 2% fall in prices and rents, all else being equal. On that basis, a mass-downsizing would imply a cut in prices of about 5%."
When things have doubled in price, getting 5% off isn't really much help, especially when, as they noted, purchase taxes have gone up considerably.