The following graphs all show how much of American’s wealth is (or, um, was) in the form of home equity. They are all based on 2002 data, several years before housing prices hit their peaks, which means by the time the housing bubble burst, home equity was an even larger proportion of all net worth.
It’s not that I didn’t already know the economy was in trouble. That’s obvious–I live in Vegas, all I have to do is drive around a little and see all the houses sitting empty. But looking at these images I kept thinking, “a good portion of that home equity wealth is just gone.” On paper, we had all this wealth, and people borrowed based on it…and a lot of it is simply gone. Just…poof. Gone!
This one shows what percent of all net worth in the U.S. falls into various categories.
Here we have median net worth in 2002 for different age groups…and then the lighter purple bar, which is median net worth if you took out home equity:
A similar breakdown, except by race, not age this time. Notice how much Blacks and Hispanics lag behind Asians, and how much they lag behind non-Hispanic Whites in terms of net worth:
On the up side, if the stock market keeps going down, then home equity as a percent of our net worth will go up again because we’ll have lost so much in stocks. So, you know, look on the bright side!
All of these graphs came from “Net Worth and the Assets of Households: 2002,” written by Alfred O. Gottschalck and published by the U.S. Census Bureau in April 2008.