Every three years, the Federal Reserve conducts their Survey of Consumer Finances in which they collect data across all economic and social groups. The latest survey, which includes data from 2010-2013, reports that a homeowner’s net worth is 36 times greater than that of a renter ($194,500 vs. $5,400).
The latest survey data, covering 2014-2016 will be released later this year. In the meantime, Lawrence Yun, the National Association of Realtors’ Chief Economist estimates that the gap widened even further, to 45 times greater ($225,000 vs. $5,000)!
Your Housing Cost Works for You
Simply put, homeownership acts as a form of ‘forced savings.’ Every time you pay your mortgage, you contribute to your net worth. Every time you pay your rent, you contribute to your landlord’s net worth.
The latest National Housing Pulse Survey from NAR reveals that 84% of consumers believe purchasing a home is a good financial decision. William E. Brown comments:
“Despite the growing concern over affordable housing, this survey makes it clear that a strong majority still believe in homeownership and aspire to own a home of their own. Building equity, wanting a stable and safe environment, and having the freedom to choose their neighborhood remain the top reasons to own a home.”
Ready to Stop Raising Your Landlord’s Net Worth?