40 Years of Data Say the Same Thing

By Chris Doherty

Christian Doherty lists and sells more homes than any other agent in the Greater Lowell, Massachusetts market with over 300 homes sold in the past 12 months. Chris is ranked in the top 1% of all agents in the United States.

I want you to focus on one thing and one thing only that will tell the tale of real estate for you. There are a few things certain in this world. Death, taxes, and real estate prices in the long term always go up.

The one report that matters most

I want you to focus on probably the most important index in real estate. The measure, the guide that everybody uses: the Case-Shiller Price Index. It goes back 40 years. It shows you in graph form where real estate prices have been over that entire period, and when you look at it, there’s only one direction the line goes over the long term. Up.

If you’re a buyer asking yourself, “Am I going to buy and everything’s going to crash and I’m not going to make any money?” Look at this chart. If you’re a seller wondering where your home’s value is going to be over the long term, look at this chart. It answers both questions.

The bumps along the way

Now, that’s not to say that over those 40 years there haven’t been some dips. There were challenges during the dot-com bubble in the early 2000s, and you can see a pullback in the data. You can certainly see the pullback in 2008. That one was real, and it scared a lot of people away from real estate for years.

At the same time, you can see the acceleration of prices when COVID happened. Values shot up at a pace nobody predicted.

But if you strip away all the bumps, the bruises, the “what if this happens,” the “what if a crisis comes,” the “what if the market pulls back,” and you look at the chart from start to finish, the trend is unmistakable. Over the long term, real estate prices always go up.

My grandmother’s house tells the whole story

I looked up my grandmother’s house when she bought it in Tewksbury, Massachusetts. That property sold for $37,000.

$37,000.

Today that house is selling for well into the $700,000 range. The house is still there. The house is the same. It’s a little bit older, but they’ve kept up with it. It still has the same pool. And in Tewksbury, Massachusetts, that house is now in the mid to high $700,000s.

Why? Because real estate prices always go up. Not every year. Not in a straight line. But over time, always.

What this means for you right now

For my clients who are trying to time the market, for the people who are worried that they’re not going to get their return back, remember this: look at the Case-Shiller report and use it as your long-term guide.

So long as you don’t sell in a panic, so long as you hold, if you go through a crisis, if there’s a problem with the economy, if everything feels like it’s falling apart, if prices dip for a couple of years, you know that the trend will continue. Prices will return and they will continue to climb. The data from the last 40 years proves it.

You’re always better buying real estate and holding it for the long term. Those who do, through the ups and downs, will be rewarded.

If you want to talk about what the long-term picture looks like for your specific situation, call or text me at (978) 746-0124, email me at chris@dohertyproperties.com, or visit chrisdoherty.com. I hope you’re having a great week, and I look forward to seeing you soon.