How Many Homes Does the Average American Own? (2023 Update)
Americans spend plenty of money each year on homes and real estate — many people even consider it part of the American Dream. But how many Americans achieve this dream and own homes? How many homes do Americans own? If these questions interest you, keep reading as we find the answers to these questions and more.
What Percentage of Americans Own Homes?
The current percentage of Americans who own at least one home is a little more than 65%. Experts believe that this trend will continue throughout 2023, with minor quarterly fluctuations that can bring the percentage up as high as 68%, but it may also get as low as 64%.
Homeownership can also vary depending on where you live. For example, 62% of people in northeastern states like Maine and Pennsylvania are homeowners. In comparison, it’s closer to 67% in the southeast and south-central United States, from Virginia to Texas. Homeownership is highest in the north-central states, like North Dakota and Minnesota, and down to Missouri, where it reaches 71%. The lowest homeownership rate occurs in the west, from Washington to New Mexico, where it currently stands at 60%.
How Many Homeowners Are Still Paying Their Mortgage?
Unfortunately, many homeowners in the United States are still paying their mortgage, so they are technically still buying the home and are not exactly homeowners yet. In addition, the COVID-19 pandemic caused the government to step in with a program called Forbearance, which allows people to skip paying their mortgage payments for up to a year without any penalties. While not making the payments will not lead to increased rates or fines, it will extend the amount of time that you need to wait before becoming a homeowner. Luckily, more than a million people chose to continue paying as usual. It’s hard to get exact numbers about how many people owe mortgages because banks tend to withhold that information, but in 2019, Forbes reported that approximately 40% of homes in the United States were free and clear of a mortgage.
What Percentage of Americans Own Multiple Homes?
Approximately 2.7% of the 78.7 million occupied homes owned by homeowners in the United States are second homes, totaling a little more than 1.5 million. However, this figure doesn’t account for homeowners who own more than two homes or vacant homes. Currently, vacant homes make up 11% of the total housing in the United States.
Homes Owned by the Ultra-Rich
Market Watch reports that the richest people in the United States own an average of nine homes. However, they tend to keep these expensive homes off American oil, with Mexico being the most popular. The American rich like to own homes in other places, including the Bahamas, England, the Caribbean, and France. Mexico, the Bahamas, and the Caribbean are likely so popular because they are close to the United States and have beautiful weather, while England or France are chosen because of their history and sophistication. Many of the wealthiest people in the United States also own 19 vehicles to help them get around. $1.9 million in insured jewelry and $19.6 million worth of insured fine art are also average.
Homeowners Versus Renters
Unfortunately, statistics show that renters are 89.9% more likely to be behind on their payments, and household wealth is 1.469% higher in homeowners than renters. Statistics show that renters were hit harder than owners during the pandemic, and more than 10% needed to use at least a portion of their stimulus checks offered by the government to pay rent. These stats also show that 25% of renters spend more than 50% of their income on rent. However, homeowners are in a similar boat, with 28% spending more than 30% of their income on mortgage payments.
Costs Associated With Purchasing a Home
Homes can cost anywhere from $10,000 for a budget tiny house to a multimillion-dollar mansion in Beverly Hills. Aside from the cost of the house, there are other costs associated with the purchase. Most homes require a down payment to show that you are interested in the property. The down payment can be as low as 3% with government assistance programs like FHA, and it can get as high as 20%.
The other expense associated with purchasing your home is the closing cost. Many first-time homebuyers fail to include this in their calculations. This fee is usually a percentage of the sale price, and it pays the realtor and other fees. It can vary significantly based on where you live, the relator you choose, and other factors, but it’s usually 2%–5%. Though 2% may seem small, the median house cost in the United States is almost $350,000, which means you will need to turn over an additional $7,000 to the realtor at the time of closing, separate from the money that you are putting on the house. The closing cost money is also paid up front, unlike the house itself, which most people pay off using a mortgage.
Owning a home can be a great experience, and it’s part of the American Dream. Currently, about 65% of Americans are homeowners, though only about 40% have the house paid off completely. This number of homeowners has remained fairly consistent, and forecasts expect it to remain so into at least 2023, despite the current high price of real estate. Homeowners are less likely to fall behind in their payments than renters, and they usually have more savings.
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Featured Image Credit: Allan Wood Photography, Shutterstock