Inflation Adjusted House Prices 1.9% Below 2022 Peak; Price-to-rent index is 7.6% below 2022 peak

Today, in the Calculated Risk Real Estate Newsletter: Inflation Adjusted House Prices 1.9% Below 2022 Peak

Excerpt:

It has been 18 years since the bubble peak. In the May Case-Shiller house price index released on Tuesday, the seasonally adjusted National Index (SA), was reported as being 73% above the bubble peak in 2006. However, in real terms, the National index (SA) is about 11% above the bubble peak (and historically there has been an upward slope to real house prices).  The composite 20, in real terms, is 2% above the bubble peak.

People usually graph nominal house prices, but it is also important to look at prices in real terms.  As an example, if a house price was $300,000 in January 2010, the price would be $432,000 today adjusted for inflation (44% increase).  That is why the second graph below is important - this shows "real" prices.

The third graph shows the price-to-rent ratio, and the fourth graph is the affordability index. The last graph shows the 5-year real return based on the Case-Shiller National Index.
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The second graph shows the same two indexes in real terms (adjusted for inflation using CPI).

In real terms (using CPI), the National index is 1.9% below the recent peak, and the Composite 20 index is 2.5% below the recent peak in 2022. Both indexes increased slightly in May in real terms.