Wealth Gap Between Homeowners and Renters Grows
The wealth gap between homeowners and renters is growing, according to housing market platform Realtor.com. The typical U.S. homeowner currently has a net worth of $430,000. Comparatively, the net worth of the average renter is just $10,000. In other words, the average homeowner is now 43 times wealthier than the average renter. In 2022, the homeowner median net worth of $392,600 was about 39 times higher than the typical renter's net worth of $10,400.
In order to increase the rate of homeownership, homes need to be priced lower
As prices have grown, it has become more difficult for renters to become homeowners. In order to turn more renters into homeowners, home prices have to be attainable to the typical renter across the U.S. This means that there needs to be more homes priced at $250,000 or below. However, Realtor.com data show that the national median list price for homes in May was $440,000, or 76% higher than the target price of $250,000.
Out of the 50 largest U.S. metros, just Pittsburgh had a median listing price under $250,000 in May. Just five other cities—including Birmingham, Ala., Detroit, and St. Louis—recorded median listing prices under $300,000.
A lack of affordable home prices have made the path to homeownership more difficult
- Rentership Surges Above Homeownership in the Suburbs: Renting is becoming more common—even in traditional homeowner housing markets like the suburbs. Currently, 203 suburbs across the top 20 largest U.S. metros have more renters than homeowner households.
- Report Finds Only Two US Housing Markets Remain Truly Affordable: Because of growing home prices, just two major metros have median incomes high enough to comfortably afford the median-priced home.