The new study finds that consumers who bought a new home in 2016 have more money in their pockets after the home was sold.
In fact, consumers who owned a home between 2010 and 2016 had a net worth of $1.2 trillion compared to $1 trillion for those who never owned a house.
The study also found that homeowners who bought in 2016 had $2.3 trillion in wealth compared to the $2 trillion for the $1,200-a-month earners.
When adjusted for inflation, the net worths of the top 10% of homeowners rose by $2,200.
That means that those homeowners had $1 million more in the bank after owning a home in 2015.
Even when accounting for inflation (which has risen for the past five years), the top 1% of households still had $6 trillion in the Bank of America account, more than $400 billion more than the bottom half of the population.
The top 10%, meanwhile, had a $2 billion worth of wealth after owning homes in 2016, nearly triple their share of the nation’s wealth at that point in the 20th century.
Overall, the study found that home ownership had a huge positive impact on households’ financial wellbeing.
“While homeownership is a great investment for the economy, the costs associated with owning a property and its maintenance are much higher than expected,” said the study’s author, David W. Hartley, a professor at Cornell University and author of the book The Wall Street Millionaire.
“It is not clear that home equity has as much impact as one might expect.”
The study did not include any analysis of homeownership rates, though the Wall Street Journal found that in the past two decades, home values have gone up for most Americans.
The study found a positive correlation between homeownership and median household income.
However, it did not measure homeownership among other key indicators, such as homeownership rate, mortgage interest rates, and homeowner credit scores.
The study’s authors said the data needed to be more comprehensive.
“Homeownership rates and income are among the most important economic indicators of a household’s success,” Hartley said.
“But they do not capture the complexity of the real world of buying and selling a home.”
The report’s findings were supported by research published in December by the Urban Institute, which found that a higher share of American households own their own homes, and that the median home price had gone up over the past four decades.
The Urban Institute noted that more than half of homeowners owned a two- or three-bedroom home in 2020, up from 44% in the 1960s.