Homeownership’s Impact on Net Worth

A good article explaining the relationship between one’s personal network and homeownership. For many American’s prior to the recession their home’s equity was a significant portion of their net worth. As the real estate market continues to improve and prices continue to increase home owners are once again seeing their net worth increase as their equity position improves!

by  on October 14, 2013 in For Buyers

HomeownerVsRenter

Over the last five years, homeownership has lost some of its allure as a financial investment. As homeowners suffered through the housing bust, more and more began to question whether owning a home was truly a good way to build wealth. A recent study by the Federal Reserve formally answered this question.

Some of the findings revealed in their report:

  • The average American family has a net worth of $77,300
  • Of that net worth, 61.4% ($47,500) of it is in home equity
  • A homeowner’s net worth is over thirty times greater than that of a renter
  • The average homeowner has a net worth of $174,500 while the average net worth of a renter is $5,100

Bottom Line

The Fed study found that homeownership is still a great way for a family to build wealth in America.

 

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