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$7 Trillion in Wealth Has Vanished In the Last 6 Years

Americans are not nearly as wealthy as they were just a few years ago. Sure the stock market is not far of its peak that it reached in 2007 and the unemployment rate is improving. However, most Americans have not replaced the wealth that was lost in the aftermath of the housing market crash.

The sheer magnitude of the evaporation of wealth among American families is astonishing. Homeowners alone have seen over $7 trillion in wealth vanish since the peak of the housing bubble.

$7 TRILLION!!!

That means every man, woman and child living in the U.S. has lost $23,000 in wealth in the last 6 years.

It’s no surprise that few Americans believe economists when they say the recession is over. Economic growth may be back, but American’s wealth is not. That’s why Americans are still looking for ways of saving money.

At the end of 2005, American homeowners had a net equity of $13.2 trillion in real estate. The most recent numbers from the Federal Reserve show that homeowner’s net equity has fallen to $6.1 trillion in 2011.

For many people, a significant portion of their net worth is their equity in their home. For young families and even middle-aged folks, their home is their largest asset. Watching the equity in your primary asset be cut in half is very disillusioning to say the least.

Market commentators have been talking about a potential housing recovery for the last two years. Yet home values continue to slide in the wrong direction.

Even a robust recovery in real estate may fall short of many people’s expectations. After all, we have over $7 trillion in vanished wealth to make up for.

Filed in: Christian Finance, Debt & Credit, Real Estate

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