National Housing Market Outlook

$208K Net Worth Increase for Over 60% of the US

John Macke

March 29, 2024

Key takeaways

  • Mortgage rate buydowns and a limited supply of resale homes have received substantial press as key factors fueling the demand for new homes. A third factor hasn’t received the attention it deserves: accumulated home equity.
  • Massive amounts of built-up home equity support the demand for housing, even in the face of affordability challenges

The typical homeowner who has owned a home for the last 4 years just received a $208K boost in net worth as home prices have exploded at an unprecedented rate. 

Assuming a 10% down payment on a purchase of a median-priced home and a prevailing 30-year fixed mortgage rate at the time of purchase, homeowners will have accumulated, on average, the following equity:

  • January 2000: $414K in total home equity today
  • January 2006: $338K in total home equity today
  • January 2013: $343K in total home equity today
  • January 2020: $208K in total home equity today

This build-up in home equity supports housing demand across all buyer segments, especially as home prices have become more unaffordable. Of course, not everyone has benefited from this rise in home equity, leading to a growing gap between those who own a home and those who don’t.

Our Metro and Regional Housing Package drills deeper into home equity insights by market.

Homeowners hold $31.8 trillion in home equity, a staggering increase from just under $15 trillion in home equity at the prior housing cycle peak in 2006. Homeowners are in great financial shape with healthy balance sheets and much more disposable income.

Homeowners are using accumulated equity differently, depending on their stage of homeownership.

  • Move-up homes: Homeowners are using their home equity to purchase move-up homes. Many are using built-up equity for a larger down payment to reduce monthly payments or even to purchase in cash.
  • Entry-level homes: First-time or entry-level buyers may benefit from generational wealth transfer, overcoming financial barriers to homeownership. Homeowners with massive home equity may contribute to family members’ down payments and/or mortgage payments, making homeownership more accessible.
  • Repair and remodeling (R&R) spending: Home equity and the lock-in effect (many homeowners are “locked in” and unwilling to give up their sub-6% mortgage rates for today’s market rates) support R&R spending, as homeowners may use their home equity to finance home improvements and renovations. Home equity also supports economic stability by boosting homeowners’ financial confidence, driving up consumer spending and investment in the broader economy.


  • Builders: Pay attention to homeowners with substantial home equity who are reaping significant benefits. Their children and families stand to gain from an unprecedented wealth transfer, which will continue as the population ages. With substantial discretionary income from years of robust wage growth and minimal housing expenses, this group possesses sizable spending power.
  • Rental operators: Expect consumers with no accumulated home equity to drive long-term rental demand as the ongoing affordability dilemma prevents them from buying a home. For those renters considering a home purchase, mortgage rate buydowns are critical in making this a reality. These buyers also are likely to purchase homes that serve their basic needs but lack the bells and whistles.
  • Building product manufacturers: Monitor home equity in your markets as homeowners may use their accumulated equity to finance home improvements and renovations. Tracking home equity will help you forecast and budget repair and remodel orders/spending for the future.

The unprecedented accumulation of home equity will remain a pivotal driver of housing demand across move-up buyers, entry-level buyers, and R&R spending.

Our research and consulting teams are helping clients unlock new insights to better navigate the current environment. Our research team helps for-sale, for-rent, and building products executives and investors stay on top of quickly changing market conditions, and our consulting team applies this knowledge to specific investment and strategy decisions.

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About The Author

John Macke
Senior Research Analyst, For-Sale
John leads JBREC’s Southern California market coverage for the Metro Analysis and Forecast reports, produces the Regional Analysis and Forecast and Homebuilder Analysis and Forecast reports, and assists with coverage of the public homebuilder space.

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