Over the last 75 years, real estate has a 92% win streak.
When people think about real estate investing, a common idea you hear is “real estate always goes up.” But like any asset class, residential real estate has both years of appreciation and decline.
To answer how many years U.S. home prices declined versus appreciated, I looked at historical house price indices such as the S&P/Case-Shiller Home Price Index. This index has been reconstructed back through the 20th century and provides annual snapshots of national home price levels.
Over 75 years of housing history, annual home price changes ended positive about 92% of the time. That means in more than 9 out of 10 years, home values rose year-over-year.
So, there was around 69 years where home prices appreciated and about 6 years where prices fell.
In other words, the weight of historical evidence supports the idea that Real Estate Investing delivers positive annual price appreciation the vast majority of the time—but the exceptions matter.
The down years were in 1990 when real estate only fell 1%. Then between 2007-2011 when the Great Recession and subprime mortgage crisis unfolded. In those five years, real estate fell 5%, 12%, 4%, 4% and 4% respectively – see the graph below.
These periods are often studied by investors precisely because they demonstrate that Real Estate Investing is not immune to cyclical risk.
Even though there are years when prices fall, the long-term trajectory of U.S. housing shows cumulative gains. This resilience is why real estate investing remains an important part of individual’s portfolios: you get exposure to an hard asset class with more up years than down, and the potential to generate capital gains.
Why Real Estate Investing Still Works Long-Term
Even though there are years when prices fall, the long-term trajectory of U.S. housing shows significant cumulative gains.
- Over the long haul, nominal U.S. home price appreciation is up since the 1940s. For example, data series that go back decades show that the price level of housing in the U.S. rose for most of the post-World War II era up through the present.
- When you couple price appreciation with rental income and leverage, total returns on residential real estate often approach or exceed broader market returns—especially for disciplined investors who hold properties over decades.
This resilience is precisely why real estate investing remains a cornerstone of many diversified portfolios: you get exposure to an asset class with historically more up years than down, and the potential to generate both capital gains and income.
Real Estate Investing Today – Still A Good Idea?
This brings me back to, “is this a good time to buy, or is it a buyers market?”
My first response is to watch my January and February market update videos. In each, I share gobs of data that answer these questions. When we’re together looking at real estate, I say the same thing over and over.
My next response is to pay close attention to the big market themes like mortgage rates and housing supply.
Today, mortgage rates are the lowest they’ve been since 2022. Today’s 30-yr fixed mortgage is 6%. That’s almost 1% lower than where it was this time last year. That makes real estate investing more approachable for folks today.
As for supply, there are 57,820 properties for sale in South Florida. In 2019, there were 53,500.
So, rates and supply favor buyers today. Add these to the 75-year trend for real estate investing and you should be excited to get active in today’s real estate market.
Remember, when buying real estate, long-term holding horizons matter. And, when you plan to begin real estate investing… patience and perspective are as crucial as location.
(Main Photo Above: Drone photo of Tropic Isle area and Intracoastal)
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*** Before touring homes, YES, you need to sign the Buyer Broker Agreement. Read this update so you’re not caught off guard
*** ONLY 2, 2-bed, 2-bath units out of 160 in Pineapple Grove Condos are For Sale – This downtown Delray condo listing wants a buyer. 2 Gyms, his & her dry saunas, a pool, business center, bicycle parking, secure-gated parking and walking distance to everything
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*** South Florida Real Estate Inventory is ABOVE 2019***
Last week’s supply was 57,885
Today’s supply is 57,820
*** Supply is DOWN 28 of 42 weeks…***
