The CPI is designed to measure inflation, not consumer spending. Since people need a place to live, and a house is one of a few options, I'd say this is a fairly obvious design flaw.

I meant to say changes in consumer spending which happens to be the best gauge of inflation.

Since people need a place to live, and a house is one of a few options, I'd say this is a fairly obvious design flaw.

The amount you spend on a house is not 500k all at once (in a vast vast majority of cases). It's the cost of a mortgage and property taxes. The total cost of the house is a far less relevant way to measure inflation because it's not highly related to the value of the USD. It's related to interest rates and zoning laws more than anything else.