New Study Homeownership Creates Family Wealth

Dated: 04/10/2015

Views: 337

New Study: Homeownership Creates Family Wealth | Keeping Current Matters

Matthew Rognlie, from the Department of Economics at MIT, recently released a paper:Deciphering the Fall and Rise in the Net Capital Share. One of the major findings of the report is that homeownership is and has been for the last fifty years a major component to family wealth.

An article on the study in The Economist notes one of the findings of the study:

“The return on non-housing wealth, in fact, has been remarkably stable since 1970. Instead, surging house prices are almost entirely responsible for growing returns on capital.”

This came as no surprise to us as the Federal Reserve previously reported that the net worth of families that own their own home is 36 times greater than that of families that rent.

Bottom Line

HousingWire’s Senior Financial Reporter, Trey Garrison, summed it up well in hisreporting on Rognlie’s study:

“Homeownership has consistently created generational wealth more reliably, and more ‘democratically’, than any other asset class. And it does so in a manner entirely ancillary to its primary purpose of giving you a place to lay your head and keep your stuff.”

Want to Advertise on this Site?

Latest Blog Posts

Buying A Home Take Stock Of These Things

What are some of the most important factors that buyers take into consideration when looking for a new home? There are the obvious things like price, square footage, location and lot size. Those are

Read More

Millennial Home Buyers What You Need To Know

In the past, you’ve likely read about how the Millennial generation is opting to rent rather than buy property. While this still holds true for many Millennials, the fact is that a growing number

Read More

New Home Construction Boom Expected

The housing market has been trending in a positive direction and economic indicators point to new home construction going vertical. Following the housing bubble and sluggish post-recession economy,

Read More

4 Things To Know About Homestead Exemptions

Homeowners are well aware that peripheral costs swell over time and can put a strain on incomes. Utility bills increase, home insurance creeps up annually and taxes rise with the cost of schools and

Read More