Homeownership has many highly rated benefits that are proven to be the key drivers in the housing market. Additional financial advantages of homeownership are having the best possible tax situation and following a budget that works best for you. Consumer respondents gave us an insight into the top four financial benefits of owning a home:
- 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
The Federal Reserve recently released the Survey of Consumer Finances which highlighted that homeownership is a strong financial asset. This survey found that homeowners have an astonishing 40 times higher net worth than renters. Homeowners have an average net worth of $255,000 compared to renters who have a net worth of $6,300. The difference in net worth between renters and homeowners has steadily grown over the last 10 years. The gap between the net worth of homeowners and renters has widened even more over the last year.
The ability to build equity puts homeowners far ahead of rent in terms of household wealth. Homeowners have a greater net worth than renters regardless of the amount of income. Homeowners who are 65 and older have 47.6 times greater net worth compared to renters. A Joint Center for Housing Studies of Harvard University report on homeowners and renters over the age of 65 reveals:
“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.”
It is proven that homeownership is the foundation to building your net worth over time. Homeownership is full of financial benefits. If you are interested in beginning the home buying process, connect with a Seven Gables Advisor to learn more about this great opportunity.