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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. At the national level, a homeowner who purchased a single-family existing home 10 years ago would have gained $225,000 in home equity if the home were sold at the median sales price of $363,100 in 2021 Q3.

The past five years have seen rapid price appreciation. Nationally, median single-family existing-home sales rose 8.5% annually from 2016 Q3 through 2021 Q3. A homeowner who purchased a typical home five years ago would have accumulated $144,400 in home equity, of which $121,800 would be from price appreciation, or 84% of total home equity gains.

While home prices fell about 30% from the peak level in 2006, home prices have rebounded, with the median single-family existing-home sales price rising at an annual pace of 3.2% from 2006 Q3 through 2021 Q3. A homeowner who purchased a home 15 years ago would typically have accumulated $193,300 in home equity, of which $137,700 is price appreciation.

Because home prices tend to appreciate over the long run and due to the principal payments, wealth grows over time. Over a 30-year period when single-family home prices rose at an annual pace of 4.2%, home equity gains were at least $500,000 in 23 metro areas, 15 of which are in the West region.

Use the data visualization below to find out the home equity gains in your metro area. The equity gains will depend on the home's characteristics. 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.

1 Source: Federal Reserve Board, Survey of Consumer Finances, 2019

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