The value of homeownership continues to assert itself, with a report by First American Data & Analytics showing how Americans who own their homes accumulate more wealth over time than those who rent the place in which they live. “In deciding whether to rent or own, it’s important to remember the wealth-building power of equity accumulation,” First American Chief Economist Mark Fleming said in his analysis of the company’s latest Real House Price Index (RHPI) data, adjusted for income and interest rate changes. “Even homeowners who bought at the height of the housing boom in 2006 have gained $169,000 in equity, while renters over that same time period cumulatively lost $229,000 in wealth.”

The RHPI showed that prices decreased by 3.1% between August and Sept. 2024, falling 9.2% year-over-year. Consumer house-buying power, or how much one can purchase based on changes in income and mortgage rates, increased 3.7% in September from the month prior and increased 14.5% year over year. Fleming emphasized that while improving affordability is providing some relief, it’s still a long way from the historical average.

Source: First American