[brusselssprouts]

I think these graphs mistakenly compare inflation adjusted wages to unadjusted house price. It also fails to account for increases in house size.

Inflation adjusted cost per square foot is $126 in 1978 and $146 in 2020, about a 16% increase. Inflation adjusted wages over the same years went from 24.5K in '78 to 36K in '19, for about a 46% increase.

According to these stats, housing is actually more affordable for the same home size.

Wage numbers from your fed link, and housing numbers from here: https://www.supermoney.com/inflation-adjusted-home-prices/

[david-gpu]

I wonder to what extent homes have increased in size to compensate for the higher price of the land they are built on.

In my neighbourhood over the last ten years small-ish 1-floor homes built in the 70s and 80s have been consistently replaced with 3-story McMansion atrocities.

You can't buy a smaller, cheaper, house because they are not being built, and I suspect the reason I'd that their price per square foot would be sky high due to the cost of the land.