The U.S. Homeownership Rate Is Growing
Today, there is still a strong desire to own a home. In actuality, the Census shows an increase in the homeownership rate in the United States. The graph below displays the homeownership rate over the previous year to demonstrate the rise:
According to the data, the percentage of Americans who live in homes they own is currently over 50%, and it is steadily rising.
Here are just a few explanations as to why owning a home is so valuable to so many individuals, in case you're considering doing so this year.
Why Are There More Homeowners Today?
The advantages of home ownership are many. A key one is that owning a property can help shield you from cost increases, particularly when inflation is strong, as it is right now. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), explains:
“In the 1970s, when inflation was running around 10%, home prices were rising at approximately the same rate. Renters actually have a harder time in inflationary periods, because rents tend to rise along with inflation, whereas mortgage payments stay the same for homeowners with fixed-rate mortgages.”
With a fixed-rate mortgage, you may fix your housing payment, which is likely to be your largest monthly expense, for the life of the loan, which is typically 15 to 30 years.
This gives you a stable monthly housing expense that may be advantageous in the short term, but as your home's value increases and you continue to make your mortgage payments, you will also build equity over time.
Your net worth will rise along with that rising equity. The median household net worth of a homeowner is actually around $300,000, whereas the median net worth of renters is only about $8,000. This is according to the most recent data from NAR. Thus, the net worth of a homeowner is roughly 40 times more than that of a renter.
In America, more people are becoming homeowners. Let's connect if you're prepared to start the home-buying process and find the house of your dreams.