Adjusted for inflation, the highest real estate values in London England were seen in the time of Napolean. (Seriously).
A house is not an investment.
Both American stats going back a hundred years and dutch stats going back several hundred years show home prices do vary but grow at the rate of inflation.
Sometimes this variation can go for decades, but there is always a readjustment.
But this time is different, much like it was with tulips, the south seas, Louisiana, radio stocks, gold and silver in the 80's, tech stocks in the 90's etc.
If you want to make money on real estate you should be looking to be a bitch, aka landlord. There are risks there also, but long term capital appreciation isn't the way to go. That however is dependent on being able to buy in at a reasonable price.
In the past 50 years or so home prices have gone up a lot, but if you consider that the average home has more than doubled in size, plus various renos and insulation standards and the currency dropping to about 10% of its value, it really isn't all that impressive. Granted there are pockets where things have done better than average, which means there are pockets that have done worse.
If you really want to make money on capital appreciation, buy into a city which is about to put in huge amounts of barriers to new construction and wait 10 or 20 years. Cough Portland Cough [if memory serves]. Sure it will fuck over poor people and the environment, but you will make lots of money and the city will be seen to be progressive and green which is more important after all.
