Housing is a Crucial Piece of Your Net Worth

Home ownership is a great way to build long-term wealth and create financial security. In times of economic uncertainty, investors often turn to real assets such as real estate as a safe and reliable investment. Real estate is a tangible asset that can appreciate in value over time, providing a hedge against inflation and protecting against market volatility. Furthermore, owning a home can provide tax benefits, as mortgage interest and property taxes are typically deductible, and capital gains are taxed at favorable rate. According to Freddie Mac:

“Building equity through your monthly principal payments and appreciation is a critical part of homeownership that can help you create financial stability.”

With spring approaching, now’s a great time to consider if buying a home makes sense for you. The best way to figure that out is for us to grab a cup of coffee or hop on the phone!

The Largest Part of Most Homeowners’ Net Worth Is Their Equity

You may be surprised to learn just how much of a homeowner’s net worth actually comes from owning their home. The National Association of Realtors (NAR) shares:

“Homeownership is the largest source of wealth among families, with the median value of a primary residence worth about ten times the median value of financial assets held by families. Housing wealth (home equity or net worth) gains are built up through price appreciation and by paying off the mortgage.”

In other words, home equity does more to build the average household’s wealth than anything else. And according to data from First American, this holds true across different income levels (see graph below):

Bottom Line

One of the biggest benefits of owning a home, regardless of your income level, is that it provides financial stability and an avenue to build wealth. Let’s connect today so you can start investing in homeownership.