Real Estate
Charting 20 Years of Home Price Changes in Every U.S. City
At the turn of the century, the average U.S. home value was $126,000. Today, that figure is at a record high $259,000 – a 106% increase in just two decades.
Of course, the path from A to B was anything but linear with a financial crisis, housing bubbles in major cities, and now COVID-19, which is drastically altering market dynamics.
How has the housing market evolved, on a city-by-city basis?
Two Decades of Housing Prices
The interactive visual below – created by Avison Young Global, using data from Zillow – is a comprehensive look at U.S. home price data over the past two decades.
Editor’s note: Click the circles at the top of the visualization to see other versions of the data, including price changes at the state and zip code level.
The Lay of the Land
A number of things become apparent when looking at historical data of hundreds of U.S. cities.
First, the trajectory of home prices is defined by the 2008 Financial Crisis. After prices took a steep dive, it took a full decade for the average home price to rise back up to the 2007 peak.
Next, broadly speaking, the U.S. average is being “pulled up” by the hottest regional markets. The majority of housing markets have seen between a 50% and 100% increase in price over the past 20 years. This is also true at the state level, where booming markets such as Hawaii saw price increases double the U.S. average.
Going West
The West Coast has seen dramatic home price appreciation in over the last two decades, a trend that permeated the entire region. Every single city tracked in this database beat the U.S. average.
California and Hawaii saw the biggest gains, with a number of cities ending up with a 200%+ increase over prices in 2000.
The biggest gains in the entire country over the time period was Madera, California, which is located just north of Fresno. The nearby cities of San Jose and San Francisco rose by an impressive 235% and 219%, respectively. As a practical example – during the meteoric rise of Silicon Valley, average prices in San Francisco shot up from $364,000 to $1.12 million.
Even the bottom city (Yakima, Washington) on the left coast saw an increase of 114%.
Slower Home Price Changes
In general, cities located in America’s “Rust Belt” states saw slower home price growth. In fact, every city in these five states saw price growth below the U.S. average.
Of the top 20 U.S. metros, Detroit and Chicago saw the slowest price growth over the past two decades. Flint, Michigan, was the only city in the country to see a price decline.
At the state level, Illinois, Michigan, and Ohio were the bottom three in terms of home price appreciation.
A Useful Barometer
Looking at country or state level data fails to capture the incredible nuance of home values around the country.
That said, since the value of a primary residence makes a significant portion of wealth for most Americans, these price movements serve as a useful barometer of the health of the real estate market, and the economy as a whole.
Markets
Mapped: The Top 30 Most Valuable Real Estate Cities in the U.S.
U.S. real estate value is concentrated in a handful of urban centers. Here’s a look at the top 30 most valuable cities.
Investor Education
Ranking Asset Classes by Historical Returns (1985-2020)
What are the best-performing investments in 2020, and how do previous years compare? This graphic shows historical returns by asset class.
Historical Returns by Asset Class (1985-2020)
Mirror, mirror, on the wall, is there one asset class to rule them all?
From stocks to bonds to alternatives, investors can choose from a wide variety of investment types. The choices can be overwhelming—leaving people to wonder if there’s one investment that consistently outperforms, or if there’s a predictable pattern of performance.
This graphic, which is inspired by and uses data from The Measure of a Plan, shows historical returns by asset class for the last 36 years.
Asset Class Returns by Year
This analysis includes assets of various types, geographies, and risk levels. It uses real total returns, meaning that they account for inflation and the reinvestment of dividends.
Here’s how the data breaks down, this time organized by asset class rather than year:
| U.S. Large Cap Stocks | U.S. Small Cap Stocks | Int'l Dev Stocks | Emerging Stocks | All U.S. Bonds | High-Yield U.S. Bonds | Int'l Bonds | Cash (T-Bill) | REIT | Gold | |
|---|---|---|---|---|---|---|---|---|---|---|
| Ticker | VFIAX | VSMAX | VTMGX | VEMAX | VBTLX | VWEAX | VTABX | VUSXX | VGSLX | IAU |
| 2020* | 1.5% | -5.5% | -10.3% | -0.7% | 4.9% | -0.5% | 2.6% | -0.7% | -16.4% | 21.9% |
| 2019 | 28.5% | 24.5% | 19.3% | 17.6% | 6.3% | 13.3% | 5.5% | -0.1% | 26.1% | 15.9% |
| 2018 | -6.2% | -11.0% | -16.1% | -16.2% | -1.9% | -4.7% | 1.0% | -0.1% | -7.7% | -3.2% |
| 2017 | 19.3% | 13.8% | 23.8% | 28.7% | 1.4% | 4.9% | 0.3% | -1.3% | 2.8% | 9.3% |
| 2016 | 9.7% | 15.9% | 0.4% | 9.5% | 0.5% | 9.0% | 2.5% | -1.8% | 6.3% | 6.6% |
| 2015 | 0.6% | -4.3% | -0.9% | -16.0% | -0.3% | -2.0% | 0.3% | -0.7% | 1.6% | -12.3% |
| 2014 | 12.8% | 6.7% | -6.4% | -0.2% | 5.1% | 3.9% | 8.0% | -0.7% | 29.3% | -1.2% |
| 2013 | 30.4% | 35.8% | 20.3% | -6.4% | -3.6% | 3.1% | -0.4% | -1.5% | 0.9% | -29.0% |
| 2012 | 14.0% | 16.2% | 16.5% | 16.8% | 2.4% | 12.5% | 4.5% | -1.7% | 15.7% | 6.5% |
| 2011 | -0.9% | -5.5% | -15.0% | -21.0% | 4.6% | 4.2% | 0.8% | -2.9% | 5.5% | 5.5% |
| 2010 | 13.4% | 26.0% | 6.8% | 17.2% | 5.0% | 10.9% | 1.7% | -1.5% | 26.6% | 26.0% |
| 2009 | 23.3% | 32.7% | 24.9% | 71.5% | 3.2% | 35.6% | 1.6% | -2.4% | 26.3% | 20.2% |
| 2008 | -37.0% | -36.1% | -41.3% | -52.8% | 5.1% | -21.3% | 5.5% | 2.0% | -37.0% | 5.4% |
| 2007 | 1.3% | -2.7% | 6.8% | 33.6% | 2.8% | -1.8% | 0.1% | 0.7% | -19.7% | 25.8% |
| 2006 | 12.9% | 12.9% | 23.1% | 26.3% | 1.8% | 5.7% | 0.5% | 2.1% | 31.8% | 19.3% |
| 2005 | 1.4% | 3.9% | 9.8% | 27.7% | -0.9% | -0.5% | 1.8% | -0.5% | 8.3% | 13.0% |
| 2004 | 7.3% | 16.2% | 16.5% | 22.1% | 1.0% | 5.2% | 1.8% | -2.0% | 26.7% | 1.4% |
| 2003 | 26.2% | 43.1% | 36.1% | 54.7% | 2.1% | 15.1% | 0.4% | -0.9% | 33.3% | 19.2% |
| 2002 | -23.9% | -21.8% | -17.6% | -9.6% | 5.8% | -0.6% | 4.2% | -0.7% | 1.3% | 20.8% |
| 2001 | -13.3% | 1.6% | -23.1% | -4.4% | 6.8% | 1.3% | 4.6% | 2.6% | 10.7% | -0.4% |
| 2000 | -12.0% | -5.8% | -17.1% | -29.9% | 7.7% | -4.1% | 5.4% | 2.5% | 22.2% | -9.6% |
| 1999 | 17.9% | 19.9% | 23.6% | 57.3% | -3.4% | -0.2% | -0.6% | 2.0% | -6.5% | -1.7% |
| 1998 | 26.6% | -4.2% | 18.0% | -19.4% | 6.9% | 3.9% | 10.2% | 3.5% | -17.7% | -2.4% |
| 1997 | 31.0% | 22.5% | 0.0% | -18.2% | 7.6% | 10.0% | 8.9% | 3.5% | 16.8% | -23.2% |
| 1996 | 18.9% | 14.3% | 2.6% | 12.1% | 0.3% | 6.0% | 8.3% | 1.9% | 31.4% | -7.7% |
| 1995 | 34.0% | 25.6% | 8.4% | -1.9% | 15.3% | 16.2% | 14.3% | 3.1% | 10.0% | -1.7% |
| 1994 | -1.5% | -3.1% | 4.9% | -10.1% | -5.2% | -4.3% | -7.3% | 1.3% | 0.4% | -4.9% |
| 1993 | 7.0% | 15.5% | 28.9% | 69.4% | 6.7% | 15.1% | 10.7% | 0.2% | 16.3% | 13.9% |
| 1992 | 4.4% | 14.9% | -14.7% | 7.8% | 4.1% | 11.0% | 3.3% | 0.6% | 11.2% | -8.7% |
| 1991 | 26.3% | 40.9% | 8.7% | 54.5% | 11.8% | 25.2% | 7.5% | 2.5% | 31.5% | -12.5% |
| 1990 | -8.9% | -22.8% | -27.9% | -16.1% | 2.4% | -11.3% | -2.7% | 1.6% | -20.3% | -8.3% |
| 1989 | 25.5% | 11.0% | 5.6% | 56.9% | 8.6% | -2.6% | -0.6% | 3.7% | 3.9% | -6.8% |
| 1988 | 11.3% | 19.7% | 22.8% | 33.9% | 2.8% | 8.8% | 4.4% | 2.1% | 8.6% | -19.6% |
| 1987 | 0.3% | -12.7% | 19.3% | 9.3% | -2.8% | -1.7% | 4.5% | 1.3% | -7.8% | 19.0% |
| 1986 | 16.8% | 4.5% | 67.5% | 10.4% | 13.9% | 15.6% | 10.1% | 5.0% | 17.7% | 17.9% |
| 1985 | 26.4% | 26.2% | 50.3% | 22.9% | 17.6% | 17.5% | 7.0% | 3.8% | 14.6% | 1.7% |
*Data for 2020 is as of October 31
The top-performing asset class so far in 2020 is gold, with a return more than four times that of second-place U.S. bonds. On the other hand, real estate investment trusts (REITs) have been the worst-performing investments. Needless to say, economic shutdowns due to COVID-19 have had a devastating effect on commercial real estate.
Over time, the order is fairly random with asset classes moving up and down the ranks. For example, emerging market stocks plummeted to last place amid the global financial crisis in 2008, only to rise to the top the following year. International bonds were near the bottom of the barrel in 2017, but rose to the top during the 2018 market selloff.
There are also large swings in the returns investors can expect in any given year. While the best-performing asset class returned just 1% in 2018, it returned a whopping 71.5% in 2009.
Variation Within Asset Classes
Within individual asset classes, the range in returns can also be quite large. Here’s the minimum, maximum, and average returns for each asset class. We’ve also shown each investment’s standard deviation, which is a measure of volatility or risk.
Although emerging market stocks have seen the highest average return, they have also seen the highest standard deviation. On the flip side, T-bills have seen returns lower than inflation since 2009, but have come with the lowest risk.
Investors should factor in risk when they are looking at the return potential of an asset class.
Variety is the Spice of Portfolios
Upon reviewing the historical returns by asset class, there’s no particular investment that has consistently outperformed. Rankings have changed over time depending on a number of economic variables.
However, having a variety of asset classes can ensure you are best positioned to take advantage of tailwinds in any particular year. For instance, bonds have a low correlation with stocks and can cushion against losses during market downturns.
If your mirror could talk, it would tell you there’s no one asset class to rule them all—but a mix of asset classes may be your best chance at success.
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