To put that into perspective, the average homeowner’s net worth is roughly 40X that of a renter. The gap in net worth exists because as a homeowner, you gain equity as your home appreciates in value and as you pay your mortgage each month. As a renter, you’ll never see a return on the money you pay out in rent every month. Experts agree it’s a great time to explore the benefits of homeownership, even in a competitive market. Here's what several industry leaders have to say about why homeownership is a wise long-term investment. Homeownership is the largest source of wealth among families. . . . Housing wealth (home equity or net worth) gains are built up through price appreciation and by paying off the mortgage. - Scholastica Gay Cororaton, Research Economist, NAR As Natalie Campisi states "Homeowners are shielded from mounting rental prices because their cost is fixed, regardless of what’s happening in the market. . . . Tangible assets like real estate get more valuable over time, which makes buying a home a good way to spend your money during inflationary times." What Does This Mean for You? As the data shows, rents are skyrocketing. The big difference between renting and owning a home is, that when you rent, that rising cost benefits your landlord’s investment strategy, but it doesn’t deliver any sort of return for you. In contrast, when you buy a home, your monthly mortgage payment works like a forced savings account. Over time, as you pay down your loan and as home values rise, you build equity (and by extension, your own net worth). According to the latest data from CoreLogic, the average homeowner gained $56,700 in equity over the past year, a number that continues to grow as home values appreciate.
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