{"id":9412,"date":"2023-11-07T06:30:00","date_gmt":"2023-11-07T11:30:00","guid":{"rendered":"https:\/\/blog.sfloridaluxuryhomes.com\/?p=9412"},"modified":"2023-11-07T06:30:00","modified_gmt":"2023-11-07T11:30:00","slug":"homeowner-net-worth-has-skyrocketed-2","status":"publish","type":"post","link":"https:\/\/blog.sfloridaluxuryhomes.com\/?p=9412","title":{"rendered":"Homeowner Net Worth Has Skyrocketed"},"content":{"rendered":"
\"Homeowner<\/p>\n

If you\u2019re weighing your options to decide whether it makes more sense to rent or buy<\/a> a home today, here\u2019s one key data point that could help you feel more confident in making your decision. Every three years, the Federal Reserve Board <\/em>releases the Survey of Consumer Finances<\/em><\/a> (SCF). That report covers the difference in net worth for both homeowners and renters. Spoiler alert: the gap between the two is significant.<\/p>\n

The average homeowner\u2019s net worth is almost 40X greater than a renter\u2019s. <\/strong>And here\u2019s the data to prove it (see graph below<\/em>):<\/p>\n

<\/a><\/p>\n

<\/p>\n

The Big Reason Homeowner Net Worth Is So High<\/strong><\/h4>\n

In the previous version<\/a> of that report, the net worth of the average homeowner was roughly $255,000 and that of the average renter was $6,300. But in the release<\/a> that just came out this year, the gap widened as homeowner net worth climbed dramatically. As the Survey of Consumer Finances<\/em> (SCF) report says<\/a>:<\/p>\n

\u201c. . . the 2019-2022 growth in median net worth was the largest three-year increase over the history of the modern SCF, more than double the next-largest one on record.\u201d<\/em><\/p><\/blockquote>\n

One of the biggest reasons homeowner net worth skyrocketed is <\/strong>home equity<\/strong><\/a>. <\/strong><\/p>\n

Over the last few years, known as the \u2018unicorn\u2019 years<\/a> for housing, home prices went through the roof. That\u2019s because there weren\u2019t enough homes for sale, and there was a big influx of buyers rushing to buy them and take advantage of the then record-low mortgage rates. That imbalance of supply<\/a> and demand pushed prices higher and higher. As a result, most homeowners who had a home during that time saw their equity grow a lot.<\/p>\n

If you\u2019re still in the middle of making your decision on whether to rent or buy, you may wonder if you missed the boat on the big net worth boost. But here\u2019s what you need to realize. As a recent article in The Ascent<\/em> explains<\/a>:<\/p>\n

\u201cWhether your net worth increased in recent years or not, there are steps you can take to boost that number in the coming years. . .\u00a0<\/em>buying a home can be a great way to grow your net worth, since home values have a tendency to rise over time<\/em><\/strong>.\u201d<\/em><\/p><\/blockquote>\n

Historically, home prices<\/a> climb over time. Even now that mortgage rates<\/a> are closer to 7-8%, prices are still rising<\/a> in many areas of the country because supply is still low compared to demand. That\u2019s why expert forecasts<\/a> for the next few years call for ongoing appreciation<\/a> \u2013 just at a pace that\u2019s more typical for the housing market.<\/p>\n

While it likely won\u2019t be the record ramp-up that happened over the last few years, people who buy now should continue to grow equity in the years ahead. That means, if you\u2019re ready and able to buy a home today, you\u2019ll be making an investment that\u2019ll help build your net worth in the long run.<\/p>\n

As Jessica Lautz, Deputy Chief Economist at the National Association of Realtors <\/em>(NAR), says<\/a>:<\/p>\n

\u201c. . . when deciding to rent vs buy, one must calculate the total cost of homeownership (maintenance, utilities, commuting, etc.) and the total financial benefit. Based on new Fed data . . . <\/em>the median net worth of homeowners was $396,200 vs renters at $10,400. There is no question about the wealth gains that homeownership provides.\u201d<\/em><\/strong><\/p><\/blockquote>\n

Bottom Line<\/h3>\n

If you\u2019re on the fence about whether to rent or buy a home, remember that homeownership can give your net worth a big boost over time. If you want to learn more about this or the many other <\/span>benefits of owning<\/a> a home, connect with a local real estate agent.<\/span><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

If you\u2019re weighing your options to decide whether it makes more sense to rent or buy a home today, here\u2019s one key data point that could help you feel more confident in making your decision. Every three years, the Federal Reserve Board releases the Survey of Consumer Finances (SCF). That report covers the difference in […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"bgseo_title":"","bgseo_description":"","bgseo_robots_index":"","bgseo_robots_follow":"","footnotes":""},"categories":[3],"tags":[],"class_list":["post-9412","post","type-post","status-publish","format-standard","hentry","category-blog"],"_links":{"self":[{"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/posts\/9412","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=9412"}],"version-history":[{"count":0,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/posts\/9412\/revisions"}],"wp:attachment":[{"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=9412"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=9412"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=9412"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}