It’s easy to forget that there actually are some nice things about owning a house.
This came up while I was interviewing Ron Phipps, the current president of the National Association of REALTORS. We spoke a lot about falling home values — the median sales price of a home, $156,100, fell to its lowest point in nine years in February, and homes on average have lost $26,800 worth of value from June of last year to February of this — and about the still staggering number of housing foreclosures glutting the market.
But then Phipps mentioned some data compiled by the national association. Turns out, even with home values falling, families that own homes tend to be better off financially than are those who rent.
Here are the numbers that Phipps shared with me: About 75 million families in the United States own homes, anda bout 46 million of these families have mortgages on these residences. The average net worth of these families stands at $188,000.
The average net worth for families that rent stands at just $4,600.
Of course, this is just one way to look at the economic impact of owning a house. There are plenty of families who have purchased homes that are far more expensive than they can afford. They’re the ones facing foreclosure today. And they certainly aren’t better off financially than are the those families who made the economic choice to rent.
But it’s hard to argue with those net worth numbers. Even in a terrible time for the housing market, owning a home seems to be a smart financial choice for those families that don’t spend more than they can afford.