Housing wealth
House on pile of money

Housing wealth

When people say they own their home, it’s usually a half-truth at best. Often, a bank owns the home they live in — most of it, anyway.

Still, Americans have a lot of real money tied up in their homes — on average, $150,506, according to a new report by the Urban Institute called “How Much House Do Americans Really own? Measuring America’s Accessible Housing Wealth by Geography and Age.”

That amount represents what’s left over after the debt on the mortgage is subtracted from the home’s 2015 value. It also represents a major portion of most Americans’ net worth, making “net housing wealth” a critical element to many families’ economic future and security.

The Housing Wealthy

Not surprisingly, there are wide disparities of net housing wealth among age groups and geographic areas. Older folks who’ve been paying mortgages longer own more of their homes, and places where real estate values have skyrocketed also add to this real net housing worth bottom line. In Washington, D.C., the average net worth is around $381,000, for example, while in Arkansas, it’s around only $80,000. Meanwhile, California had only 9.3% of all owner-occupiedhousing units but accounted for 20.4% of total net housing wealth for the country.

These aren’t merely paper values; homeowners can borrow between 75 and 85% of the net value of their homes via home equity loans or lines of credit, depending on their credit score. Cash-out loans and reverse mortgages are also possible. So net home wealth represents a real, usable asset that can serve both as safety net and opportunity for investment.

“Homeownership is important to building wealth,” said report author Laurie Goodman. “This can be seen by the fact that housing wealth, while inequitably distributed, is still more equitably distributed than other types of wealth.”

Nationally, there were over 73 million owner-occupied housing units in the U.S. in 2015. Of these, around 46 million had home debt such as mortgages and equity loans, and nearly 27 million were owned free and clear. The Urban Institute calculates that there is about $11 trillion in total net housing wealth across the country, and about $7 trillion of that could be turned into cash through lending products.

Age is big predictor of net housing wealth. The report found that those over 60 hold 52% of all home equity. Those under 50 hold only 23%. Meanwhile, owners under 40 owned 17% of all owner-occupied housing units but had only 6% of accessible housing wealth.

Where’s the Housing Wealth?

But real home net worth exists all around the country, and by some measures is spread around fairly evenly. The report found that 80% of all homeowners nationwide had equity at or above 15% of the current value of their home. In Hawaii, Washington, D.C., Vermont, and California, nearly 90% of homeowners had at least 15% equity. In Rhode Island and Nevada, the rate was 70-72% — not so wide a gap.

On the other side of the coin, there are still substantial numbers of Americans for whom their house is a liability, not an asset.

The report says that almost 9% of homeowners aged between 50 and 59, and 7.5% of those aged 60-64 owed over 5% more than their houses were worth. That group is staring at retirement while being upside-down on a mortgage.

Much has been made in recent years about the stagnant wages of the American middle class, but middle class net worth has also been stagnant. For example, a 2014 report by the U.S. Census showed that the middle quintile of Americans saw their net worth shrink from $74,000 to $69,000 between the years 2000 and 2011. On the other hand, the richest 20% of Americans saw their net worth soar over the same period.

The Urban Institute authors note concerns about some government policies that might exacerbate housing-based inequality. Still, they conclude, homeownership is an important part of wealth building for the vast majority of the U.S. population.

“Government at all levels — the government-sponsored enterprises, lenders, housing providers and advocates — must work together to improve access to mortgage credit that allows owners to sustain homeownership and enhance the economic well-being of their families,” it says.

Remember, a good credit score can help you secure an affordable mortgage, so it’s a smart idea to see where you stand before you start filling out applications. (You can view two of your credit scores for free each month on Credit.com.) If your credit is looking a little lackluster, you may be able to improve your score ahead of time by disputing errors on your credit reports, paying down high credit card balances and limiting new credit inquiries until your standing rebounds.

This article originally appeared on Credit.com and was written by Bob Sullivan.