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Experts Agree: Homeownership Provides a Path to Long-Term Wealth

Experts Agree: Homeownership Provides a Path to Long-Term Wealth | Simplifying The Market

A recent survey from LendingTree.com found there are multiple reasons why Americans would choose to purchase a home instead of renting. Some of the most popular non-financial reasons given include:

  • The flexibility to make the space your own
  • The pride homeownership offers
  • The sense of stability

In the same survey, 41% of respondents say they’d rather own a home than rent because of the unique way homeownership builds wealth over time.

And experts agree – the home you own is an important tool for building your net worth. Here’s what many of those experts have to say about building long-term financial stability through homeownership.

According to the National Association of Realtors (NAR):

“Homeowners who purchased a typical single-family existing-home 30 years ago at the median sales price of $103,333 with a 10% down payment loan and who sold the property at the median sales price of $357,700 in 2021 Q2 accumulated housing wealth of $349,258, . . .

Mark Fleming, Chief Economist at First American, points out that a home is truly a one-of-a-kind asset. It’s the only asset that’s both an investment and a place for you to call your own.

“The major financial advantage of homeownership is the accumulation of equity in the form of house price appreciation. . . . We won’t always have 17% house price appreciation, but we have to take into account the fact that the shelter that you’re owning is an equity-generating or wealth-generating asset.

Homeowners can leverage the wealth they generate in several ways throughout their life. Tapping into accumulated equity has long been used to pay for the cost of an education, to start a business, or to fund various other expenses. The Joint Center of Housing Studies at Harvard points out:

“. . . by paying down mortgage principal each month and participating in the long-term appreciation of home values, a family can build wealth that can be used for retirement or other needs, including helping the next generation.

Bottom Line

With home prices expected to continue to appreciate in coming years, homebuyers have an opportunity to start the long-term wealth-building process right now. Let’s connect today if you’re ready to begin your journey on the path to becoming a homeowner.

Content previously posted on Keeping Current Matters

About Les Sulgrove

Les is an Iowa native born in Des Moines and raised in the southwest Iowa town of Bridgewater. He has been a resident of Des Moines since 1982 and has been married to his wife Linda for over 35 years. Together they have 3 grown children, 7 grandchildren and make their home on Des Moines south side. He has been a licensed REALTOR® since 1990 and is Vice President at VIA Group, REALTORS®. Les is the 2011 Past President of the Des Moines Area Association of REALTORS® (DMAAR) and received the award of Salesperson of the Year by DMAAR in 2007 for his involvement and service to the Association. Additionally, he is active at the Iowa Association of REALTORS® and serves on local, state and national committees. He also owns and operates the national technology networking group CyberProfessionals. This group of real estate professionals meets twice annually across the United States to learn from each other and share new marketing ideas with heavy emphasis on current and future technologies and their use in the real estate business. Les’ hobbies include golf, photography and sarcastic humor. He and Linda spend many Saturday mornings from Spring to Fall at the Des Moines Downtown Farmers Market. He enjoys spoiling his grandchildren at every opportunity.

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