What happened?
President Nixon unilaterally destroyed the Bretton Woods System with his Nixon Shock. That sent interest rates soaring. As a result, the buying power of the average American peaked in 1972. The cost of housing has been rising ever since.
It seems far more likely that it was things like the single-room occupancy stock, which almost completely disappeared between 1960 and 1980, that changed housing availability and therefore prices far more. I say like because I suspect it was not at all monocausal, in terms of the regulations that made building more and more varied, harder.
https://en.wikipedia.org/wiki/Single_room_occupancy
> As a result, the buying power of the average American peaked in 1972
This seems suspect on the face of it. Percent of money spent on food, after all, has gone down dramatically since. You might say it's for reasons beyond inflation (eg, better food supply), but then so is everything else related to those conditions.
Nixon's actions couldn't have come at a worse time - right at millions of Baby Boomers were coming into the housing market the money with which to build housing was constrained. The supply hasn't kept up with the demand since then. Each decade since has seen housing reach new highs when adjusted for inflation.
Even the looming Boomer die-off won't change the situation much. For one, they're the longest-lived generation in history. The other is there's decades of pent-upped demand for housing. The simple fact now is the majority of Americans will never own a home. That's become our norm and it was policy set in motion over 50 years ago by Nixon that led us here.
Square footage of house heated and temp set point have also increased. If you want to blame Nixon for our modern comfort then maybe he should get a medal. We clearly feel that we can spend much more on it than we used to: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4456148/
Miles driven per year have increased from 3.5k in 1970 to to 10k. If we're driving 3x as much, and cars are more complex, it would be weird if we weren't spending more on transportation.
> The supply hasn't kept up with the demand since then.
Yes, we agree, but this has nothing to do with Nixon, and everything to do with regulation choices that are independent of Bretton Woods. Again, you should look at other countries before deciding on something so monocausal for your explanation.
> The simple fact now is the majority of Americans will never own a home.
Despite the regulatory environment, home ownership in the US is almost the highest in history, and higher than 1970.
The problem we're having now is they've running out of rabbits to pull out of their hat. The US government has been on a spending spree for the past 40+ years and running up a huge tab, and US households are now dual-income households and have just about maxed out their employment options. Then what?