15 49.0138 8.38624 1 1 4000 1 https://lets-talk-real-estate.com 300 true 0
theme-sticky-logo-alt

Homeownership Is Full of Financial Benefits

0 Comments

A Fannie Mae survey recently revealed some of the most highly-rated benefits of homeownership, which continue to be key drivers in today’s power-packed housing market. Here are the top four financial benefits of owning a home according to consumer respondents:

  • 88% – a better chance of saving for retirement
  • 87% – the best investment plan
  • 85% – the chance to be better off financially
  • 85% – the chance to build up wealth

Additional financial advantages of homeownership included in the survey are having the best overall tax situation and being able to live within your budget.

Does homeownership actually give you a better chance to build wealth?

No one can question a person’s unique feelings about the importance of homeownership. However, it’s fair to ask if the numbers justify homeownership as a financial asset.

Last fall, the Federal Reserve released the Survey of Consumer Finances, a report done every three years, with the latest edition covering through 2019. Their findings confirmed that homeownership is a clear financial benefit. The survey found that homeowners have forty times higher net worth than renters ($255,000 for homeowners compared to $6,300 for renters).

The difference in net worth between homeowners and renters has continued to grow. Here’s a graph showing the results of the last four Fed surveys:Homeownership Is Full of Financial Benefits | Simplifying The MarketThe above graph only includes data through 2019, but according to CoreLogic, the equity held by homeowners grew by $26,300 over the last twelve months alone. That means the gap between the net worth of homeowners and renters has probably widened even further over the last year.

Some might argue the difference in net worth may be due to homeowners normally having larger incomes than renters and therefore the ability to save more money. However, a study by First American shows homeowners have greater net worth than renters regardless of their income level. Here are the findings:Homeownership Is Full of Financial Benefits | Simplifying The MarketOthers may think homeowners are older and that’s why they have a greater net worth. However, a Joint Center for Housing Studies of Harvard University report on homeowners and renters over the age of 65 reveals:

“The ability to build equity puts homeowners far ahead of renters in terms of household wealth…the median owner age 65 and over had home equity of $143,500 and net wealth of $319,200. By comparison, the net wealth of the same-age renter was just $6,700.”

Homeowners 65 and older have 47.6 times greater net worth than renters.

Bottom Line

The idea of homeownership as a direct way to build your net worth has met the test of time. Let’s connect if you’re ready to take steps toward becoming a homeowner.

Previous Post
Latest Jobs Report: What Does It Mean for You & the Housing Market?
Next Post
Multigenerational Housing Is Gaining Momentum [INFOGRAPHIC]
Mark Sincavage, REALTOR®

Mark Sincavage is a full-time real estate agent and REALTOR® Associate since 2010. Licensed in New Jersey, New York and South Carolina. — Dedicated and hardworking, Mark prides himself on making sure that all his clients experience smooth and successful real estate transactions. — Through experience and continued education, Mark has achieved the premier credentials of Seller Representative Specialist (SRS), Seniors Real Estate Specialist (SRES), Short Sale and Foreclosure Resource (SFR) and Resort & Second Home Property Specialist (RSPS). — When you’re ready to buy or sell residential real estate, Mark Sincavage is here to help!