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Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
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Author: Knighted ✧  😊 😞
Number: of 15055 
Subject: Re: Berkshire and Tariffs
Date: 04/12/2025 8:19 AM
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What kind of tent did you buy? When I bought a house in 1983 it cost 5 times my annual salary. When I sold it 30 years later, it cost 5 times my last annual salary before I retired. My salary had grown quite a bit in real terms over the years, fortunately, but still no earth shattering change overall in housing prices.

I think one disconnect here is interest rates. Rates were super high in the 80's, so while housing prices were lower at that time (and a smaller fraction of one's annual salary than today), housing prices combined with high interest rates still made housing affordability very challenging for the average family paying a mortgage.

Today, rates are not as high, but real housing prices have gone up in price more than they were then. The end result is a similarly challenging environment that is reflected by this chart from a businessinsider article on the topic showing that we have the worst housing affordability situation in over 40 years today:

https://i.insider.com/6541237696f7540cd06a5c90?wid...
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