Boise Real Estate Investment Blog With Picture of Piggy Bank

New Years Resolution - Investing in Boise Real Estate

As we approach the new year, it is only fitting to engage in thoughtful reflection on our future aspirations. Whether these ambitions focus on career progression, financial stability, or the pursuit of personal goals, it is worth considering the substantial impact that homeownership could have in shaping one's financial trajectory.

Beyond the realms of comfort and security, homeownership is a robust tool for wealth accumulation and financial stability. The modern real estate market attests to this, with home values exhibiting a consistent upward trajectory, including here in Boise, Idaho. Recent data from Zillow shows that the total value of the U.S. housing market now exceeds $52 trillion, reflecting a noteworthy increase of $1.1 trillion since the previous peak in June.
1. Rise of Household Net Worth

Recent data shows a notable increase in household net worth across various income groups. While the top 1% has seen the most significant growth, individuals in every tax bracket have experienced a noticeable boost in their wealth including those here in Boise and the surrounding areas, home values have tripled since 2013.  A key contributor to this financial uptick is the appreciable rise in the value of homes nationwide.

2. Homeownership as a Catalyst for Financial Success

Lawrence Yun, the Chief Economist at the National Association of Realtors (NAR), highlights homeownership as a crucial driver for wealth accumulation, irrespective of socio-economic background. According to Yun, your monthly mortgage payment acts like a "forced savings account," helping you amass a net worth approximately 40 times higher than renters.

The linchpin of this mechanism is home equity, which represents the value of a home minus the outstanding mortgage amount. First American's data supports this idea, demonstrating that home equity consistently outperforms alternative investments such as stocks, gold, and cryptocurrencies across varying income levels.

 

The blue portion of each bar represents housing as a portion of net worth – and it’s clearly a bigger contributor than other investments like stocks, gold, and cryptocurrencies. As you can see, across different income levels, homeownership does more to build the average household’s wealth than anything else.

3. Bottom Line

In essence, homeownership stands out as a significant avenue for enhancing and expanding one's net worth. With the onset of the new year, it is important to reflect on the transformative potential that owning a home can bring to your financial landscape.

As we approach the end of 2023, seize the opportunity to plan for a future where homeownership not only provides comfort but also acts as a catalyst for unparalleled financial growth. At Templeton Real Estate Group, we specialize in helping individuals like you find their dream homes. If you're ready to explore the possibilities of homeownership, get in touch here. Let us assist you in turning your vision of owning a home into a reality!