Lisa Mailhot | July 20, 2023
Buyers
Owning Your Home Aids in Accumulating Wealth - Some people advocate renting over buying a home presently. However, there are numerous compelling reasons to become a homeowner even today. One of the most significant advantages is that owning a home is widely considered a prudent long-term investment that steadily boosts your net worth over time.
It might surprise you to know that individuals from different income brackets who own homes have substantially higher net worth compared to renters earning the same amount. Data from First American supports this observation (refer to the graph below):
The reasons behind homeowners' greater wealth are elucidated in a recent article from Realtor.com:
“Homeownership has long been tied to building wealth—and for good reason. Instead of throwing rent money out the window each month, owning a home allows you to build home equity. And over time, equity can turn your mortgage debt into a sizeable asset.”
Essentially, the wealth generated through homeownership is closely tied to equity. As a homeowner, equity is gradually built up through mortgage repayment and the appreciation of home prices. Mark Fleming, Chief Economist at First American, pointed out in a recent podcast that this benefit does not apply to renters:
“Renters as non-homeowners gain no wealth benefit as home prices rise. That wealth actually accrues to the landlord.”
Before renewing your rental agreement, now is the ideal moment to contemplate whether purchasing a home would be a wiser decision. The best approach to determine what suits you best is to consult a real estate expert you trust. They can guide you through the advantages of homeownership and help you decide if it's the right next step for you.
If you're uncertain about continuing to rent or taking the plunge into homeownership, remember that owning a home, regardless of your income level, can significantly contribute to building your wealth. Let's connect now to begin your journey toward homeownership.
The median sales price of a U.S. home has surged to a record high of $396,500, but with more homes on the market, buyers are in a stronger position to negotiate. Learn… Read more
Mortgage applications have increased by 1.1% following a decline the previous week, signaling some shifts in the housing market. In this blog, we explore the latest mo… Read more
Many longtime homeowners in Orange County are sitting on a hidden tax burden due to outdated capital gains rules that haven’t changed since 1997. Learn how this overlo… Read more
May 2025 saw home prices at seasonal highs, but growth has nearly stalled as market dynamics shift. With more listings than buyers, slower sales, and increased negotia… Read more
Selling your home may come with a tax obligation if you earn a profit. Learn how capital gains taxes work, what exemptions may apply, and how to plan strategically to … Read more
The construction of single-family homes remained slow in May as builders face the dual challenges of high interest rates and tariff-related cost increases. Learn how t… Read more
Discover how strategic paint choices can increase the value of your property listings. A new Zillow study reveals the best colors to use for boosting home value. Find … Read more
Homebuyer down payments are shrinking for the first time in nearly two years, revealing key shifts in the U.S. housing market. FHA and VA loans are gaining popularity,… Read more
With property taxes on the rise, senior homeowners are feeling the pinch—especially in high-value areas like Orange County. This blog explores how 16 states (plus D.C.… Read more
Let's find a time that suits you best to chat about your goals, show you how we work, and figure out how we can help you the most