One of the many reasons to buy a home is that it is a significant way to build wealth and achieve financial stability. 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 just around the corner, it’s the perfect time to decide if buying a home is right for you. The best way to figure this out is to talk to a trusted real estate professional.
The Largest Part of Most Homeowners’ Net Worth Is Their Equity
You might be surprised how much equity comes from owning their home. The National Association of Realtors (NAR) shared:
“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 contributes more to the average household’s wealth-building than anything else. And according to data from First American, this holds true across income levels (see chart below):