Financial security and homeownership are especially important today as inflation rises. But many people may not realize just how much owning a home contributes to your overall net worth. As Leslie Rouda Smith, President of the National Association of Realtors (NAR), says:
“Homeownership is rewarding in so many ways and can serve as a vital component in achieving financial stability.”
Here are just a few reasons why homeownership is a worthwhile goal if you’re looking to increase your financial stability.
Owning a Home Is a Building Block for Financial Success
A recent NAR report details several homeownership trends and statistics, including the difference in net worth between homeowners and renters. It finds:
“. . . the net worth of a homeowner was about $300,000 while that of renters was $8,000 in 2021.”
The average homeowner’s net worth is roughly 40 times that of a renter (see visual below):

This report shows that owning a home is a key piece to the puzzle when building your overall net worth.
Equity Gains Can Substantially Boost a Homeowner’s Net Worth
The net worth gap between owners and renters primarily exists because homeowners build equity. As a homeowner, your equity grows as your home appreciates and you make your monthly mortgage payments.
In other words, when you own your home, you have the benefit of your mortgage payment acting as a contribution to a forced savings account. And when you sell, any equity you’ve built up comes back to you. As a renter, you’ll never see a return on the money you pay out in rent every month.
To sum it up, NAR says it simply:
“Homeownership has always been an important way to build wealth.”
Bottom Line
The gap between a homeowner’s net worth and a renter shows how foundational homeownership is to wealth-building. If you’re ready to start on your journey to homeownership, please reach out to your trusted Martino Realty Group advisor today.