A new housing report by the National Association of Realtors reveals middle-income homeowners saw their properties appreciate by 68 percent in the last 10 years. The data, however, does show substantial variations and inequalities in homeownership rates across different income and racial and ethnic groups.
Middle-income homeowners accumulated $122,100 in wealth in the last 10 years. Low-income homeowners were able to build $98,900 in wealth, while upper-income households saw an increase of $150,800.
“This analysis shows how homeownership is a catalyst for building wealth for people from all walks of life,” said Lawrence Yun, NAR’s chief economist. “A monthly mortgage payment is often considered a forced savings account that helps homeowners build a net worth about 40 times higher than that of a renter.”
Black homeowners experienced the smallest wealth gains among any other racial or ethnic group, accumulating some $115,000 in wealth in the last decade.
For the first time in this report, NAR identified the top 10 U.S. metro areas which have recorded the largest wealth gains for Black homeowners. Black households in Bellingham, Washington; Ocala, Florida; Palm Bay, Florida; Modesto, California; Greeley, Colorado; and Charleston, South Carolina were among the areas where more than 60 percent of Black households own their home. Owners in these areas were able to accumulate more than $125,000 in wealth in the last decade.
Owners who live in expensive metro areas experienced the largest wealth gains, per the report. All of the top 10 areas with the largest wealth gains for low-income owners—surpassing $290,000—were located in California.
In the San Jose metro area, specifically, low-income owners have accumulated nearly $630,000 in the last decade, and middle-income owners gained $643,000.