Yes, prices are generally quite low when nobody has any money and unemployment is 30%. That being said we do have a very serious problems of low wages, underemployment and unaffordable housing.
the difference is that there was a lot of labor that wasnt recorded. you could just show up at a dock/pier/warehouse and work for the day if you go in. these were the main jobs that were cut
Even if the math checks out, it was functionally impossible to get a loan during the Great Depression, credit was completely frozen. Read “The Great Depression: A Diary.” It’s pretty harrowing. You were lucky to keep your home, never mind buy one.
I mean…what were they buying? My grandmother grew up during the depression…her house was insulated with newspaper, heated with a single wood stove. You could probably afford that today!
There’s a number of problems making this comparison awkward.
First, the great depression lasted 15 years. Wages and housing prices both went through significant changes during those years, so it’s easily possible for the statement to have been true in one year but not another, and the OOP didn’t specify which year they were talking about.
Second, the depression resulted in large numbers of people being unemployed. Average wages weren’t the problem, the problem was having a job at all. Next, 1930s housing was much smaller than modern housing; a 1930 median house would be better compared to a 2025 starter house than to the 2025 median.
Next, housing affordability tends to be based on the typical mortgage payment more so than the raw purchase price. This is typically the biggest issue with comparisons against the 1970s and 1980s, when mortgage rates rose to shockingly high levels; the 1930s comparison doesn’t have that specific problem, but DOES predate the invention of the 30-year mortgage. Interest rates were actually pretty close to modern rates, but banks didn’t loan money on the structures we are used to today. Most loans were 12 years or less, and 5-year balloon loans were common in the lead-up to the depression.
Balloon loans require you to refinance at the end of the balloon period. This made sense during the economic boom *before* the depression, but once it started, many borrowers defaulted when they couldn’t refinance. This drove thousands of small banks into bankruptcy, and as you might expect, home prices actually went down rather than up for several years.
So yes, at the lowest point of the home market, it’s quite reasonable that wages *were* that good relative to home prices. This doesn’t mean housing was affordable.
If we decrease the price if home ownership, how are the real estate investment trusts and hedge funds going to make money for their shareholders? Come on, man! THE SHAREHOLDERS!
Apples and oranges. The median home today is more than 50% larger than the median home size back then, and today they are made with better materials and amenities. Air conditioning, electricity, indoor plumbing running water all standard today, but not nearly as prevelent in the 1920s. Adding these amenities do not come free. Houses that were built in the 1920 wouldnt pass code today. They were glorified shacks compared to what we live in today.
It’s a class war not a Left vs Right war, and the rich are winning it. As long as they keep everyone arguing over bathrooms, religion and guns they keep concentrating wealth. Watch for the corporations to buy all the bankrupt farm land…..
Just looked it up. Average income was $1,386 with a cost of living of around $4,000 per year.
An average home cost about $3,900 back then.
People made half the average annual cost of living. Doesn’t seem like anyone could save a dollar if their lives depended on it. Let alone buy a home. Different times though.
Also interesting, average salary for USA is about 66k, no one could buy a house outright in 5 years of budgeting, but perhaps that was possible back then.
There we few well made homes ( no building codes) and no home inspections or standards. You can still buy a shack in the deep south if that’s what you are looking for. Arkansas still has many homes in the 60k range.
What is absurd is that people think the cost of finite resource should be tied to inflation. When in fact the cost of a finite resource goes up much faster.
I don’t know if it’s true, but even if it were, modern financing is much more affordable than what most would have had available then. Our loans are government backed often and require far lower down payments.
But we’re the worst off in terms of affordability since the post war boom, for sure.
800 sq ft house, on a 1/4 acre, 3 rooms, 1 bathroom, and a 100 sq ft kitchen. No garage, a cellar instead of a basement, no electricity, gas, or climate control.
Vs.
2500 sq ft, 2 story house, on a 1/3 acre, 4 bedrooms, 2 1/2 bathrooms, 400 sq ft kitchen, attached garage, basement, gas, electricity, and central air.
It can be manipulated to be “true” and the biggest clues are the use of the word pay and the lack of a specified year during the decade long Great Depression. Unemployed people didn’t get paid until the creation of an unemployment system in 1935. For those fortunate enough to have a job houses were probably pretty affordable due to desperate people trying to sell their houses but that’s not a good thing.
Also based on some quick google research there was not a lot of good data on median income back then.
Keep in mind that most structures that qualified as a “house” in the 1930s would not be considered a “house” today. Most were TINY compared to modern houses, and many did not have amenities like electricity or even even indoor plumbing. A lot of houses in the 1930s were essentially a “shed with a bed and a wood stove”. Imagine living one of the larger backyard sheds that you see assembled in the parking lot outside of Home Depot and you have the idea.
Yeah and 2009 was a great time to buy a house if you had money – the problem was that a lot of people were unemployed or severely underemployed. The housing market and financing options were also wildly different back in the 1930s. Dumb comparison.
It’s broadly true (can’t confirm the exact figures) and exactly what anyone would reasonably expect if they think a sec. That’s what depressions are: deflationary events. Prices fall. Wages generally don’t because pay cuts are demoralizing and often contractually difficult. So companies respond with layoffs instead while median wages stay high
Nothing is better than a massive depression if you hang on to your job and investments. Lots of supply of anything you want including new investments, very little competing demand because a quarter of the country is unemployed and broke. If it wasn’t the best moment in American history for the middle income house buyer I’d be stunned. You would also expect the worst time to involve high salaries, low unemployment, and artificially constricted supply. Sounds familiar no?
Not to say that wages and housing prices are anywhere near optimal right now, because they aren’t. But some context is warranted. Home ownership was a completely different animal during the Great Depression. The 15 and 30 year mortgages didn’t become popular until after WWII. Those who bought houses pre-war were usually doing so on 3-5 year balloon mortgages so it’s natural that prices relative to wages would be lower.The concept of home ownership as a long-term, middle class wealth building tool comes later. Longer term loans means purchasing more expensive houses, means houses are more expensive relative to wages.
By comparison, a well preserved move in ready above average century home today can go for as little as $100k. If median income were to drop 50% for six months the whole year would be 25% decline. Home values also decline by at least 20% during depressions. $33k/$80k x 100 is roughly 41%. But why would a politician lie???
An average home is much larger in 2025, it has electricity and running water and air conditioning and a garage and to top it all of you’re not in the midst of the great depression
Presenting data this way is a form of perverse cherry picking, because large swathes of the population had little to no revenue. Many people could barely afford to eat, much less buy a house. Very low demand also contributes to lower prices in the housing market.
The Depression has never Ended, in Facked it’s got worse since they done it again in 2008, which tells me it was Orchestrated. Ie the Rich just got Richer each time it happened.
You do realize that folks were pretty excited about new houses in the 1930s (and what fraction of total homes were those?) because they had an indoor bathroom.
It was specifically called the great depression because the primary problem was *de*flation, not inflation. That’s where the value of money goes up over time instead of going lower.
Yeah you might have been able to afford a house more easily during the depression if you were on the average salary, but being the great depression, a HUGE amount of people weren’t on the average salary because they had no job at all.
On top of that, for the people who *did* have a job, buying a house was easier than usual because so few people were buying them, a lot of mortgages foreclosed so the bank had heaps of houses they desperately wanted to sell to get some money.
So factually just looking at those two metrics, yes, it was easier to buy a home during the great depression as a portion of the average income.
But in reality, if most of us were around in the great depression then no, it wouldn’t be easier to buy a house than it is now, because we would have no money or income to pay for it at all.
What’s the solution? Artificially suppress housing prices through legislation? Or artificially inflate wages through legislation. I just don’t understand what we’re supposed to do about any of this. I’m sure either one of those would have massive unintended consequences.
This is not a real statistic because these numbers don’t exist. Unlike today, where we have relatively thorough and consistent measures for income and housing costs, accurate 1933 statistics are much more difficult to come by. I can find virtually no reputable sources even claiming to present a median income. You can find things like this [1933 IRS report](https://www.irs.gov/pub/irs-soi/33soirepar.pdf), but even there, the number of returns is comically small.
So the answer is that this is a made up statistic. It’s finding a random, low quality average income statistic, misrepresenting it, and making up a fact.
The good news is that it doesn’t matter anyways, because this is also just not a good way to think about cost of living. Think about the 2009 recession. Asset values tanked. Assets (including houses) always get cheaper during recessions. A recession is by far the best time to buy an asset. The issue is just that it’s hard to buy assets during recessions, in ways that “median income” don’t fully reflect. Even though this statistic was better in 2010 than, say, 2018, purchasing a house was much less doable for a typical person in 2010.
I suspect that If you built the average new home today using the building standards present during the great depression, it would be on par cost wise with those sold at the time., as a percentage of income. They’d be built with none or poor insulation, no central heating just a wall heater, no air conditioning, no double pane windows, no dishwasher and you’d need to buy your own refigerator….. Need I go on?
It would be a 3 bedroom, with one or one and a half bath and would be around 1200 sqft. The garage would be a 1 car detatched.
Yeah financing homes wasnt really the same thing during the Depression. Mortgage backed securities made financing hones easier and cheaper. In their own way they contribute to the increase in home values, because there has been a lot of cheap money.
Back in the 30’s, you needed to put 50% down and could only finance the rest for like 5 years or something. This would necessitate lower home prices.
The problem during the Great Depression was unemployment, not relative wages.
That said, the wealth gap continues to widen year after year. Basically you’re making a bunch of money in the market or having your wages squeezed by inflation. Sometimes both but usually one or the other for most folks.
Homes also used to be smaller, and generally worse. A big part of this is that they don’t build small homes like they used to, ether in cost or quantity.
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well sure but the issues with the great depression wasn’t the quality of jobs, but the fact that there were very little compared to unemployed people.
Yes, prices are generally quite low when nobody has any money and unemployment is 30%. That being said we do have a very serious problems of low wages, underemployment and unaffordable housing.
in a vacuum, yeah it is.
the difference is that there was a lot of labor that wasnt recorded. you could just show up at a dock/pier/warehouse and work for the day if you go in. these were the main jobs that were cut
Even if the math checks out, it was functionally impossible to get a loan during the Great Depression, credit was completely frozen. Read “The Great Depression: A Diary.” It’s pretty harrowing. You were lucky to keep your home, never mind buy one.
I mean…what were they buying? My grandmother grew up during the depression…her house was insulated with newspaper, heated with a single wood stove. You could probably afford that today!
There’s a number of problems making this comparison awkward.
First, the great depression lasted 15 years. Wages and housing prices both went through significant changes during those years, so it’s easily possible for the statement to have been true in one year but not another, and the OOP didn’t specify which year they were talking about.
Second, the depression resulted in large numbers of people being unemployed. Average wages weren’t the problem, the problem was having a job at all. Next, 1930s housing was much smaller than modern housing; a 1930 median house would be better compared to a 2025 starter house than to the 2025 median.
Next, housing affordability tends to be based on the typical mortgage payment more so than the raw purchase price. This is typically the biggest issue with comparisons against the 1970s and 1980s, when mortgage rates rose to shockingly high levels; the 1930s comparison doesn’t have that specific problem, but DOES predate the invention of the 30-year mortgage. Interest rates were actually pretty close to modern rates, but banks didn’t loan money on the structures we are used to today. Most loans were 12 years or less, and 5-year balloon loans were common in the lead-up to the depression.
Balloon loans require you to refinance at the end of the balloon period. This made sense during the economic boom *before* the depression, but once it started, many borrowers defaulted when they couldn’t refinance. This drove thousands of small banks into bankruptcy, and as you might expect, home prices actually went down rather than up for several years.
So yes, at the lowest point of the home market, it’s quite reasonable that wages *were* that good relative to home prices. This doesn’t mean housing was affordable.
If we decrease the price if home ownership, how are the real estate investment trusts and hedge funds going to make money for their shareholders? Come on, man! THE SHAREHOLDERS!
Apples and oranges. The median home today is more than 50% larger than the median home size back then, and today they are made with better materials and amenities. Air conditioning, electricity, indoor plumbing running water all standard today, but not nearly as prevelent in the 1920s. Adding these amenities do not come free. Houses that were built in the 1920 wouldnt pass code today. They were glorified shacks compared to what we live in today.
It’s a class war not a Left vs Right war, and the rich are winning it. As long as they keep everyone arguing over bathrooms, religion and guns they keep concentrating wealth. Watch for the corporations to buy all the bankrupt farm land…..
Just looked it up. Average income was $1,386 with a cost of living of around $4,000 per year.
An average home cost about $3,900 back then.
People made half the average annual cost of living. Doesn’t seem like anyone could save a dollar if their lives depended on it. Let alone buy a home. Different times though.
Also interesting, average salary for USA is about 66k, no one could buy a house outright in 5 years of budgeting, but perhaps that was possible back then.
There we few well made homes ( no building codes) and no home inspections or standards. You can still buy a shack in the deep south if that’s what you are looking for. Arkansas still has many homes in the 60k range.
What is absurd is that people think the cost of finite resource should be tied to inflation. When in fact the cost of a finite resource goes up much faster.
I don’t know if it’s true, but even if it were, modern financing is much more affordable than what most would have had available then. Our loans are government backed often and require far lower down payments.
But we’re the worst off in terms of affordability since the post war boom, for sure.
Why are people so obsessed with houses? For the price of a single computer in the 70s you could buy multiple today. What does that tell you? Nothing!
800 sq ft house, on a 1/4 acre, 3 rooms, 1 bathroom, and a 100 sq ft kitchen. No garage, a cellar instead of a basement, no electricity, gas, or climate control.
Vs.
2500 sq ft, 2 story house, on a 1/3 acre, 4 bedrooms, 2 1/2 bathrooms, 400 sq ft kitchen, attached garage, basement, gas, electricity, and central air.
STFU with your HoUsE BuYiNg PoWeR BS.
It can be manipulated to be “true” and the biggest clues are the use of the word pay and the lack of a specified year during the decade long Great Depression. Unemployed people didn’t get paid until the creation of an unemployment system in 1935. For those fortunate enough to have a job houses were probably pretty affordable due to desperate people trying to sell their houses but that’s not a good thing.
Also based on some quick google research there was not a lot of good data on median income back then.
Keep in mind that most structures that qualified as a “house” in the 1930s would not be considered a “house” today. Most were TINY compared to modern houses, and many did not have amenities like electricity or even even indoor plumbing. A lot of houses in the 1930s were essentially a “shed with a bed and a wood stove”. Imagine living one of the larger backyard sheds that you see assembled in the parking lot outside of Home Depot and you have the idea.
Yeah and 2009 was a great time to buy a house if you had money – the problem was that a lot of people were unemployed or severely underemployed. The housing market and financing options were also wildly different back in the 1930s. Dumb comparison.
It’s broadly true (can’t confirm the exact figures) and exactly what anyone would reasonably expect if they think a sec. That’s what depressions are: deflationary events. Prices fall. Wages generally don’t because pay cuts are demoralizing and often contractually difficult. So companies respond with layoffs instead while median wages stay high
Nothing is better than a massive depression if you hang on to your job and investments. Lots of supply of anything you want including new investments, very little competing demand because a quarter of the country is unemployed and broke. If it wasn’t the best moment in American history for the middle income house buyer I’d be stunned. You would also expect the worst time to involve high salaries, low unemployment, and artificially constricted supply. Sounds familiar no?
“That means…..” nothing. Nobody wants a house with 1929 specs. Stop this crap.
There are PLENTY of 3br 1bt 900sq ft houses out there. Nobody wants them.
Not to say that wages and housing prices are anywhere near optimal right now, because they aren’t. But some context is warranted. Home ownership was a completely different animal during the Great Depression. The 15 and 30 year mortgages didn’t become popular until after WWII. Those who bought houses pre-war were usually doing so on 3-5 year balloon mortgages so it’s natural that prices relative to wages would be lower.The concept of home ownership as a long-term, middle class wealth building tool comes later. Longer term loans means purchasing more expensive houses, means houses are more expensive relative to wages.
By comparison, a well preserved move in ready above average century home today can go for as little as $100k. If median income were to drop 50% for six months the whole year would be 25% decline. Home values also decline by at least 20% during depressions. $33k/$80k x 100 is roughly 41%. But why would a politician lie???
An average home is much larger in 2025, it has electricity and running water and air conditioning and a garage and to top it all of you’re not in the midst of the great depression
Presenting data this way is a form of perverse cherry picking, because large swathes of the population had little to no revenue. Many people could barely afford to eat, much less buy a house. Very low demand also contributes to lower prices in the housing market.
The Depression has never Ended, in Facked it’s got worse since they done it again in 2008, which tells me it was Orchestrated. Ie the Rich just got Richer each time it happened.
You do realize that folks were pretty excited about new houses in the 1930s (and what fraction of total homes were those?) because they had an indoor bathroom.
Median is the middle value, but not the average (the mean) which would be a value affected by how many people are within each bracket.
It was specifically called the great depression because the primary problem was *de*flation, not inflation. That’s where the value of money goes up over time instead of going lower.
It’s generally much worse than inflation.
Yeah you might have been able to afford a house more easily during the depression if you were on the average salary, but being the great depression, a HUGE amount of people weren’t on the average salary because they had no job at all.
On top of that, for the people who *did* have a job, buying a house was easier than usual because so few people were buying them, a lot of mortgages foreclosed so the bank had heaps of houses they desperately wanted to sell to get some money.
So factually just looking at those two metrics, yes, it was easier to buy a home during the great depression as a portion of the average income.
But in reality, if most of us were around in the great depression then no, it wouldn’t be easier to buy a house than it is now, because we would have no money or income to pay for it at all.
What’s the solution? Artificially suppress housing prices through legislation? Or artificially inflate wages through legislation. I just don’t understand what we’re supposed to do about any of this. I’m sure either one of those would have massive unintended consequences.
This is not a real statistic because these numbers don’t exist. Unlike today, where we have relatively thorough and consistent measures for income and housing costs, accurate 1933 statistics are much more difficult to come by. I can find virtually no reputable sources even claiming to present a median income. You can find things like this [1933 IRS report](https://www.irs.gov/pub/irs-soi/33soirepar.pdf), but even there, the number of returns is comically small.
So the answer is that this is a made up statistic. It’s finding a random, low quality average income statistic, misrepresenting it, and making up a fact.
The good news is that it doesn’t matter anyways, because this is also just not a good way to think about cost of living. Think about the 2009 recession. Asset values tanked. Assets (including houses) always get cheaper during recessions. A recession is by far the best time to buy an asset. The issue is just that it’s hard to buy assets during recessions, in ways that “median income” don’t fully reflect. Even though this statistic was better in 2010 than, say, 2018, purchasing a house was much less doable for a typical person in 2010.
I suspect that If you built the average new home today using the building standards present during the great depression, it would be on par cost wise with those sold at the time., as a percentage of income. They’d be built with none or poor insulation, no central heating just a wall heater, no air conditioning, no double pane windows, no dishwasher and you’d need to buy your own refigerator….. Need I go on?
It would be a 3 bedroom, with one or one and a half bath and would be around 1200 sqft. The garage would be a 1 car detatched.
Yeah financing homes wasnt really the same thing during the Depression. Mortgage backed securities made financing hones easier and cheaper. In their own way they contribute to the increase in home values, because there has been a lot of cheap money.
Back in the 30’s, you needed to put 50% down and could only finance the rest for like 5 years or something. This would necessitate lower home prices.
The problem during the Great Depression was unemployment, not relative wages.
That said, the wealth gap continues to widen year after year. Basically you’re making a bunch of money in the market or having your wages squeezed by inflation. Sometimes both but usually one or the other for most folks.
Homes also used to be smaller, and generally worse. A big part of this is that they don’t build small homes like they used to, ether in cost or quantity.