<p>Looking at gold values is simply cherry-picking. From 1970 to 1980, the <a href="https://www.minneapolisfed.org/community/financial-and-economic-education/cpi-calculator-information/consumer-price-index-and-inflation-rates-1913" rel="nofollow noreferrer">CPI</a> went from 38.8 to 82.4, an increase of 112%, and an annualized rate of 7.8%. Your chart shows housing prices increasing about 200%, an annualized rate of about 11.6%. So while most of the price increase was due to inflation, there are 3.8 percentage points that remain unexplained. </p>

<p>One can also compare the dollar to other currencies. While the <a href="http://www.miketodd.net/encyc/dollhist-graph2.htm" rel="nofollow noreferrer">$/£</a> rate fluctuated a lot in this period, from 1970 to 1980, overall the dollar actually strengthened against the pound slightly, and from 1970 to 1976 its strength more than doubled. The <a href="http://www.macrotrends.net/2550/dollar-yen-exchange-rate-historical-chart" rel="nofollow noreferrer">Yen</a> exchange seems to show the opposite trend, however.</p>

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2018-04-16T15:52:35.263Z
2018-04-16T15:52:35.263Z
Acccumulation
<p>Ca. 1970 the prices of real estate started skyrocketing in the US: <a href="https://commons.wikimedia.org/wiki/File:Median_and_Average_Sales_Prices_of_New_Homes_Sold_in_the_US_1963-2010_Monthly.png" rel="nofollow noreferrer">Real estate prices chart</a>. Same with gold: <a href="https://www.gold.org/data/gold-price" rel="nofollow noreferrer">Gold prices chart</a>.</p>

<p>So my conclusion is that real estate did not increase in value, it was the USD that decrased its value.</p>

<p>Further my theory is that Nixon taking US out of the gold standard in 1971 was what caused this. I assume that after this the US started printing a lot of dollars and paid down their foreign debt with the new less valuable dollars.</p>

<government-debt><federal-reserve>
Did the Nixon shock cause skyrocketing real estate prices in the US?
Andy
# Did the Nixon shock cause skyrocketing real estate prices in the US?

(Asked by: username_0 on 2018-04-16)

Ca. 1970 the prices of real estate started skyrocketing in the US: [Real estate prices chart](https://commons.wikimedia.org/wiki/File:Median_and_Average_Sales_Prices_of_New_Homes_Sold_in_the_US_1963-2010_Monthly.png). Same with gold: [Gold prices chart](https://www.gold.org/data/gold-price).

So my conclusion is that real estate did not increase in value, it was the USD that decrased its value.

Further my theory is that Nixon taking US out of the gold standard in 1971 was what caused this. I assume that after this the US started printing a lot of dollars and paid down their foreign debt with the new less valuable dollars.

**Tags:** government-debt, federal-reserve


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## 1 answers

### Answer by username_1 on 2018-04-16. Score: 1 | Accepted answer

Looking at gold values is simply cherry-picking. From 1970 to 1980, the [CPI](https://www.minneapolisfed.org/community/financial-and-economic-education/cpi-calculator-information/consumer-price-index-and-inflation-rates-1913) went from 38.8 to 82.4, an increase of 112%, and an annualized rate of 7.8%. Your chart shows housing prices increasing about 200%, an annualized rate of about 11.6%. So while most of the price increase was due to inflation, there are 3.8 percentage points that remain unexplained.

One can also compare the dollar to other currencies. While the [$/£](http://www.miketodd.net/encyc/dollhist-graph2.htm) rate fluctuated a lot in this period, from 1970 to 1980, overall the dollar actually strengthened against the pound slightly, and from 1970 to 1976 its strength more than doubled. The [Yen](http://www.macrotrends.net/2550/dollar-yen-exchange-rate-historical-chart) exchange seems to show the opposite trend, however.


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