Homeownership has long been one of the most reliable paths to building wealth in the U.S., and recent data shows just how impactful it has been. According to the National Association of Realtors® (NAR), the typical homeowner gained nearly $147,000 in home equity over the past five years. That’s about $29,400 per year—nearly half the average U.S. salary. This broad trend underscores the long-term financial benefits of owning a home across different regions, making real estate a powerful tool for wealth accumulation.
Strong Market Trends Show Homeowners Are Building Wealth
Chief Economist Lawrence Yun of the NAR reports that the U.S. housing market remains stable, with distressed property sales and mortgage defaults at historic lows. During the third quarter of 2024, about 90% of U.S. metro areas experienced home price gains, with 87% seeing an increase in single-family home prices. While appreciation has cooled in some regions, the housing market’s strength continues to support the financial health of homeowners nationwide.
Home Prices Surge in the Midwest and Northeast
While housing values have increased nationwide, certain regions have seen exceptional growth. The Northeast experienced the highest annual increase in single-family home prices at 7.8%, while several Midwest cities led the nation in year-over-year price gains. Racine, Wisconsin, saw a 13.7% boost, while Youngstown, Ohio, and Syracuse, New York, also posted strong double-digit increases. These regional trends illustrate that demand remains high and homeownership is a resilient investment across diverse parts of the U.S.
Priciest Housing Markets in the U.S.
As expected, some of the nation’s most expensive housing markets remain on the West Coast, including San Jose and San Francisco, where home prices exceed $1 million. However, high-value markets like Urban Honolulu, Hawaii, and Boulder, Colorado, also made the top ten. Despite hefty price tags, these areas continue to see price growth, highlighting that even premium markets have retained value.
Slight Improvements in Housing Affordability
Housing affordability, a challenge in recent years, has shown some improvement. Mortgage payments on a median single-family home decreased slightly to $2,137 per month, and families now spend around 25.2% of their income on housing, down from 27.1% last year. This decrease offers a glimmer of hope for first-time homebuyers who have been struggling to enter the market. While affordability remains a concern, these small gains are a step in the right direction.
Good News for First-Time Homebuyers
For first-time homebuyers, affordability conditions are slowly improving. Starter homes priced around $355,900 saw a 2.3% decrease in mortgage payments from last year, making it easier for more families to qualify. Although high home prices make the journey challenging, options are opening up in more areas, and new buyers are spending slightly less of their income on housing compared to previous quarters.
Curious about your own home’s equity gains or ready to take that step in finding your dream home? Let’s talk—we’ve got you covered.
