The FRED graph above shows the average price of single-family homes in the four Census regions. Homes in the Northeast are about twice as expensive as in the Midwest or the South, with the West in between. Why so? It could be that the houses have different characteristics (e.g., size and amenities), but it more likely has to do with the location.
The second graph shows prices for manufactured homes in the same four Census regions. These homes come in a fairly standard size and layout. But more importantly for our purposes here, they’re priced at the seller location: in the Northeast, Midwest, South, or West. And they’re priced without the land they’ll be on.
The graph shows there’s no systematic or notable difference in the level of prices in the different regions. Which leads us to conclude that the main suspect for the price differences across regions (in the first graph) is the price of land. Which, obviously, differs by location.
How these graphs were created: Use the release table for home sales, check the average price for each region, click on “add to graph” and start the sample period on 2014-01-01. For the second graph, go to the release table for average manufactured home prices, check the four regions, and click on “add to graph.”
Suggested by Christian Zimmermann.