When the S&P/Case-Shiller Home Price Index Was Rising Faster Than GDP

Always easy to say in retrospect, but a sure way to tell that an asset class is a bubble is when its value increases faster than GDP for a long period of time. The chart below plots US GDP (in white) and the S&P/Case-Shiller home price index (in amber) from 87 to Q2'09. At beginning of this century, home prices started to raise faster than GDP -- which couldn't last long.


(click to enlarge)