The first graph is misleading, as it shows a spike, but what really matters is the YoY % change. As you can see in the second graph, the YoY % change relative to inflation has been above 0 since 1979. You can't have an asset (or cost, if this is rents) that is vital to life increase in price above inflation literally every year since 1979 and expect that the price will be reasonable in 2016.
I have to disagree with you. Can you provide an example of any desirable major metro in the US (besides Detroit) where housing prices have actually gone down YoY in the last 30 years? Even cities like Atalanta and Dallas with virtually unlimited space and new housing-friendly construction policies have had consistently increasing median rents for a long time. Small percentage increases in rent/house prices are normal due to a number of factors. It's the large spikes outstripping the normal increases that make things get crazy.
And you can see this empirically in SF as well. If you were in the city post dotcom crash, housing was easy to find and also reasonably priced for CA. It's only been in the last 10 years or so that everything got out of control due to the new tech boom.
I don't consider either of those a desirable location, though. That's pretty key to this whole argument - SF and cities like it are places people actually want to move to rather than just buy properties there.
> I don't consider either of those a desirable location, though.
Why not? Tampa has nice weather and no state income tax, and Las Vegas is a fun place to live.
Without real, objective measures on "desirable location" you're basically stating a tautology. The only places with rising real estate prices are desirable locations, which are evincing desirability by rising real estate prices.
I've spent quite a bit of time working in both locations and find them far inferior to many other US cities (SF, LA, NYC, Austin, Seattle, Portland, Chicago, Miami, Dallas, etc.) in terms of general quality of life for people under the age of 40. You're the first person I've met who really seems to think otherwise.
It's not really a tautology when we could take a simple poll of our target population and find out which cities they would and would not want to move to. I'd be willing to bet that neither LV nor Tampa would be very far up that list. I wish there was better data on median rent prices over time per city so we could do a comparative analysis with real price info.
[0] https://medium.com/@mccannatron/1979-to-2015-average-rent-in...