Homeowners Typically Built Housing Wealth of $240,200 Over 10 years

Homeownership is the largest source of wealth among families, with the median value of the primary residence worth about ten times the median value of financial assets held by families.1 Home equity gains are built up through price appreciation and by paying off the mortgage through principal payments.

Over the past 10 years, at the national level, a homeowner who purchased a single-family existing home would have gained $229,400 in home equity if the home were sold at the median sales price of $360,700 in 2021 Q4. Home prices rose at a strong annual pace of 8.8%, yielding a pure gain due to a price appreciation of $209,400.

Home prices rose have increased even more steeply over the past five years, at an annual pace of 9.7%. A homeowner who purchased a typical home five years ago would have gained $125,300 from just price appreciation alone.

The equity gains will depend on the home’s characteristics but over a 5- or 10-year period, the characteristics of a typical home will likely not have changed much, so the change in the median sales price is still a good indicator of the typical equity gains due to price appreciation. However, talk to a REALTOR® when buying or selling a home who can assist with giving you the best offer or list price on your home.

The West Region Had 15 of the Top 20 Metros With Largest Home Equity Gains

The West region had 15 of the top 20 metro areas where homeowners built up the largest home equity, mainly because of the strong price appreciation. Specifically, California had seven of the top 20 metros and had the top three metro areas with the largest home equity buildup: San Jose ($1.4 million), San Francisco ($1.1 million), and Anaheim ($869,400).