Market TrendsReal Estate May 15, 2023

Homeownership as a Vehicle to Build Wealth

Over the last decade, the median-priced home in the U.S. gained $190,000 in value, making the typical homeowner 40 times wealthier than if they had remained a renter, according to a new report.

Low-income homeowners (those earning no greater than 80% of the area median income) built $98,900 in wealth as their homes while middle-income (those making more than 80% but less than 200% of median area income) and upper income (those earning more than 200% of median area income) homeowners accumulated $122,100 and $150,800 in wealth respectively, according to a report released Tuesday by the National Association of Realtors.

“Over a long time of period, home ownership is a solid path towards building wealth,” says Lawrence Yun, chief economist for National Association of Realtors told USA TODAY. “It works in two ways: first you have the advantage of home price appreciation and second, it forces homeowners to save for monthly mortgage payments which renters don’t have.”

To dive into where homeowners built the most wealth, there’s a handy chart with the story.