Homeownership has many benefits, with one of the main ones involving wealth. When you own property, you’re building up equity, which you can use to pay off debts. Unfortunately, owning a home isn’t as easy as just deciding you want to buy a piece of property, and the discrepancy between owners and renters remains.
According to the 2019 Survey of Consumer Finances, the median homeowner has 40 times the household wealth compared to a renter. That equates to $254,900 compared to $6,270. However, these numbers don’t provide insight into the distribution of wealth.
Homeowners are typically wealthier in regards to every income level, except for those who are at the highest threshold. Even in the lowest income group, the median net worth is $102,500, but for renters, it’s $1,500. At that lowest income level, 92% of total homeownership net worth is connected to the value of the property.
While there are risks when it comes to homeownership, the majority of households that transition toward purchasing a home find that owning a home is one of the biggest ways to increase wealth. If you’re interested in purchasing a home, contact a trusted real estate professional to learn what steps you need to take to make that dream happen.
Sources: Blog.firstam.com, Keepingcurrentmatters.com
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