Even more than when I wrote that in 1996, predicting a new rush of mega mansions, the power currency of the day is common stock. It certainly isnt dollars. Have some stock and everything in the world is cheap, getting cheaper. Have none and things look pricey.

The Home/Stock Exchange Rate Continues To Plunge

Year

Median Home Price

Wilshire 5000 Index

House/Stock Exchange Rate

1970

$23,000

830.3

27.7

1980

$62,200

1,220.7

50.9

1985

$75,500

1,923.8

39.2

1990

$95,500

3,187.3

30.0

1995

$112,900

6,057.2

18.6

1999

$136,000

13,251

10.3

Twenty years ago, when stock options were something granted to a few key corporate officers, stock market wealth could rise and have virtually no effect on any major real estate market. Instead, new homes would be built in the Caribbean and prices would rise in Manhattan and a few established bastions of wealth, but there were no broad effects.

Housing Prices and the New Frontier

Area

Median Home Price

One Year Change

United States

$136,000

4.1%

West

$179,800

7.6%

San Francisco Bay

$372,700

12.7%

Seattle

$221,400

10.4%

San Diego

$238,500

10.7%

compare to the New Wild West

Albuquerque

$131,700

0.9%

Austin

$131,100

3.6%

Dallas

NA

NA

Denver

$174,300

16.9%

Phoenix

$128,500

5.4%

San Antonio

$93,200

1.1%