30 Years of Money Supply and Housing Costs - Every Administration, One Chart

I wrote a version of this post in December 2024 on grokthemarket.com, focused on the M2 money supply and what it explains about housing costs. This is the expanded version - 30 years of data, six administrations, one chart.

This isn't a political post. The data doesn't belong to either party. Both parties expanded the money supply. Both parties benefited from doing so. And housing costs - your housing costs - absorbed the consequences regardless of who was in office.

Monthly PITI on the median close price in the Pikes Peak MLS region. 10% down, 30-year fixed at the prevailing rate, local tax rate, $3,000/yr insurance. M2 from FRED. Dashed lines mark presidential transitions.

M2 money supply by administration

Here's the raw M2 expansion under each president, measured from inauguration month to inauguration month. The numbers are what they are.

* Clinton data begins Jan 1996 (our dataset), not Jan 1993. Trump II is ongoing - figures through Jan 2026.

What the numbers show

A few things jump out:

Every administration expanded M2. This is not a partisan observation - it's a structural feature of how the U.S. monetary system works. The money supply has grown in every four-year window since at least the 1960s. The question is always how much and how fast.

The COVID-era expansion was unprecedented in speed. Under Trump's first term, M2 grew 46% - but most of that happened in the final 10 months (March-December 2020). That's roughly $4 trillion injected in under a year. Bipartisan policy - the CARES Act passed the Senate 96-0. But the scale was without modern precedent.

Biden's M2 growth was the slowest in 30 years at 2.7% annualized. The Fed was actively tightening for most of his term. But here's the paradox: monthly payments nearly doubled under Biden ($1,772 to $3,225). Why? Because prices had already absorbed the Trump-era M2 expansion, and rates spiked from 2.7% to nearly 7%. The money was already in the system - Biden's term is when the bill came due.

Bush (W) is the mirror image. M2 grew 66% across eight years, but monthly payments actually decreased from $1,256 to $1,166. How? Rates fell from 7% to 5%, and Colorado Springs was still affordable enough that moderate price increases were absorbed by rate compression. The M2 expansion didn't show up in payments during his term - it showed up later.

The lag effect

This is the part people miss. M2 expansion doesn't hit housing costs immediately. It flows through the economy with a lag - sometimes years. The money enters through bank lending, asset purchases, and fiscal spending. It finds its way into real estate through wage growth, investment demand, and credit availability. By the time it's priced into homes, the administration that created it may already be gone.

That's why blaming (or crediting) any single president for housing affordability is a misread of the data. The median monthly payment in Colorado Springs went from $947 in 1996 to $2,870 today - a 203% increase across six administrations. That's not one president's fault. It's three decades of compounding money supply growth meeting a housing market that absorbs every dollar.

Where the chart points next

M2 is at $22.4 trillion and rising. The brief contraction of 2022-2023 - the only significant M2 decline in modern history - has reversed. The money supply is growing again at roughly 4-5% annually.

If M2 continues expanding at that pace while rates stay in the 6-7% range, the chart tells you what to expect: payments stay elevated. Prices have already absorbed the money that's in the system. The only way payments meaningfully decline from here is rate relief - and even then, lower rates tend to push prices higher, partially offsetting the savings.

Want to know where the housing market is headed? Follow the M2.

See the 2018-2026 close-up version of this chart, or check the live payment and affordability data.

Data sourced from elevateMLS (Pikes Peak region median close prices, 1996-2026), FRED (M2 money supply and 30-year fixed mortgage rates), and El Paso County Assessor (tax rates). Monthly PITI estimated using 10% down, 30-year fixed rate, 0.52% property tax, $3,000/yr insurance. Presidential terms measured inauguration month to inauguration month. This is market commentary, not financial or political advice.