The truth about housing

This is the only chart you will ever need for the US housing market. It is the famous Shiller chart, from the man you brought you Irrational Exuberance.

The chart is simple enough. It plots two long term series; real house prices adjusted for inflation and real rents adjusted for inflation. It make two simple points. First, in the last 100 or so years, US house prices, in real terms, have never been higher. Second, renting a house, in inflation adjusted terms, is close to its all time low.

Print the chart out. Put it in your wallet or stick it in your purse. Everytime you hear someone talking about real estate, pull it out and just show them the chart and say just one short sentence comprising of 20 brutal but truthful words.

"In the last century, it has never been more expensive to buy house or more cheaper to rent than today."