Economists' Outlook

Housing stats and analysis from NAR's research experts.

Distribution of Housing Wealth Across Income Groups from 2010–2020

Please note: The Tableau data visualization embeds in this post are best viewed on a laptop or desktop computer.

Homeownership is the primary source of wealth among families. Over the past decade, the value of owner-occupied housing in 917 metropolitan or micropolitan metro areas rose to $24.1 trillion in 2020 from $15.9 trillion in 2010, an increase of $8.2 trillion, with 71% of the increase accruing in high-income households, according to NAR's Housing Wealth Gains for the Rising Middle-Class Markets Report.  

This study looks at the distribution of housing wealth between 2010 and 2020 across income groups and in 917 metropolitan or micropolitan areas. For this study, NAR identified "middle-income" households as those with income of over 80% to 200% of the area median income. NAR identified rising middle-income class housing markets as markets that had the largest increase in the number of middle-class owner-occupied housing units in 2020 compared to 2010. Aggregate housing wealth is defined as the number of homeowners multiplied by the average value of property of the metro/micropolitan area. In calculating aggregate value of housing owned by owner-occupied units, the study used the 2010 and 2020 American Community Survey, 1-year PUMS data.

High-income homeowners accounted for 71% of increase in value of owner-occupied housing from 2010 through 2020

From 2010 to 2020, the aggregate value of owner-occupied housing rose from nearly $16 trillion to $24.2 trillion, or an increase of $8.2 trillion. Unfortunately, due to the massive wave of foreclosures during the Great Recession and as home prices have become less affordable, the distribution of housing wealth has worsened in the past decade, with low- and middle-income households sharing less of the housing-wealth pie. Of this total increase in aggregate housing value, high-income homeowners accounted for 71% of the increase, middle-income homeowners accounted for 26%, and low-income homeowners accounted for 4% of the increase.

Low-income homeowners comprised a smaller fraction of all homeowners in 2020, at just 27.2%, down from 38.1% in 2010, with nearly 5.8 million fewer lower-income households that were homeowners from 2010 through 2020. There were 979,143 more middle-income homeowners over this decade, but they comprised a smaller fraction of homeowners in 2020, at 43%, from 45.5% in 2010. High-income homeowners made up a larger fraction, at 29.8%, from 16.4% in 2010, with 11.1 million more high-income households in 2020 compared to 2010.

Since the Great Recession, the homeownership rate has declined across all income groups, with the largest decline in the middle-income homeownership rate, falling from 78.1% to 69.7%. Lower rates of decline in homeownership rates were observed for low-income households, at two percentage points, and high-income households, at four percentage points.

Use the data visualization below to check how the distribution of housing wealth changed in your metro area:

Metro areas in the South region lead rising middle-class housing markets from 2010 through 2020

Among 917 metropolitan/micropolitan areas, 529 areas, or 58%, had an increase in the number of middle-income households from 2010 to 2020. The top five rising middle-income housing markets with at least 50,000 more middle-income homeowner households were Phoenix-Mesa-Scottsdale (103,690), Austin-Round Rock (61,323), Nashville-Davidson-Murfreesboro-Franklin (55,252), Dallas-Fort Worth-Arlington (53,421), and Houston-The Woodlands-Sugarland (52,716).

Among areas that lost middle-income households, the largest declines of at least 20,000 households were in New York-Newark-Jersey City (-100,214), Los Angeles-Long Beach-Anaheim (-73,839), Chicago-Naperville-Elgin (-34,420), Boston-Cambridge-Newton (-28,953), Detroit-Warren-Dearborn (-25,405), and Philadelphia-Camden-Wilmington (-22,129).

Homeowners typically gained $229,400 in housing wealth over 10 years as of 2021 Q4

Nationally, a homeowner who purchased a typical single-family existing home ten years ago in 2011 Q4 at the median sales price of $162,600 is likely to have accumulated $229,400 in home equity arising (from paying off the mortgage and the home price appreciation) if the home were sold at the median sales price of $360,700 in 2021 Q4. While home prices fell about 30% during the Great Recession, home prices have increased since then such that a homeowner who purchased a home just five years ago would have accumulated $146,200 in housing wealth. For homeowners like the baby boomers who purchased a home 30 years ago, they have gained $352,100 in housing wealth. These home equity gains enable baby boomers to tap into the equity to supplement retirement income or to use toward the purchase of a smaller home or even a second home.

Use the data visualization below to check out the typical home equity gains in your metro area: