Summary: Modern American housing offers far greater comfort and convenience than homes of the mid-20th century. Living spaces have expanded and amenities have become far more widespread. Despite higher sticker prices, rising wages have made each unit of housing less costly in time prices.
The year 1956 was remarkable. The “baby boom” was in full swing, Dwight Eisenhower won a second term in the White House, and Elvis Presley topped the charts twice. It was the year IBM unveiled the world’s first computer hard drive—a 1-ton machine, the IBM 305 RAMAC, that could store a grand total of about 5 megabytes.
It was also the year I was born. Some have suggested it was the golden year for housing; however, the facts tell a much different story. Jeremy Horpedahl, an associate professor of economics at the University of Central Arkansas and a Cato Institute adjunct scholar, completed an analysis on housing amenities and found the following:
According to Horpedahl’s findings, fireplaces are the only amenity we have less of because central heating has replaced most of them. On average, only 22 percent of homes had the amenities Horpedahl looked at in 1956; today, 82 percent of them do.
Bigger Houses, Fewer Persons per Household
Median home size has almost doubled, rising from about 1,150 square feet in 1956 to roughly 2,210 square feet today. Over the same period, average household size has shrunk from 3.3 people to 2.51. The result is a dramatic increase in living space per person—from just 348 square feet in 1956 to about 880 square feet today. That’s 532 more square feet per person, or a 153 percent increase. Had space per person stayed at its 1956 level, the typical home today would measure only about 874 square feet.
Lower Time Price per Square Foot
The median home cost about $14,500 in 1956—roughly $12.61 per square foot. With average wages at $1.85 an hour, each square foot required 6.82 hours of earning. Today, the median home price is about $420,300, or $190.18 per square foot. However, average wages have risen to $36.53 an hour (before benefits), bringing the time price down to 5.21 hours per square foot. So, while the dollar price per square foot has risen 15-fold, wages have increased nearly 20-fold. The result is the time price of housing has fallen by almost 24 percent.
Compared to 1956, we now enjoy 532 more square feet per person as well as homes packed with 3.7 times more amenities—and all of it for about 24 percent less time per square foot.
Find more of Gale’s work at his Substack, Gale Winds.
