The Surprising Role Real Estate Plays In Upper-Class Net Worth
The percentage of wealth in the United States has continued to bottleneck in the highest income households. As of September 2025, over 60% of wealth is concentrated in the 90%-99% of earners, according to a Federal Reserve report. With so much wealth stagnated near the top end of earners, it can be hard to discern who is part of the upper class. While there are several telling signs that one is officially upper class, home value plays a key role in a household's net worth.
With inflation continuing to rise, and fixed mortgage rates hovering above 6%, the value and equity of one's home are key indicators of your wealth. According to the Pew Research Center, one's home is one of the most valuable assets they have, even for those living in states with high property taxes. The key in this regard is home equity; those with high home equity and even multiple properties make up large portions of the upper class. The median home listing price nationally as of October 31st, 2025, according to Zillow, is $405,967, sitting at a five-year high, making those who buy homes in 2025 increasingly elite. This rise is in part due to a shortage of supply, with Realtor.com reporting a shortfall of 6.5 million single-family homes in 2025. Additionally, upper-class investment in real estate expands beyond just personal home ownership, with larger portions of the modern real estate market sitting under the ownership of private equity and credit firms.
Home equity and private investment have made real estate expensive
The National Association of Realtors says the median age of home buyers is on the rise, now sitting at 59 years old. This comes at a time when first-time home buyers made up only 21% of buyers in 2025. This means a greater portion of homeowners are flexing their home equity when buying new real estate. Home equity is the difference between one's home value and the remainder left on one's loan. Home equity has ballooned, particularly for those who financed their home under low mortgage rates during the COVID-19 pandemic, and benefited from the rapid spike in home value, propelling individuals into the upper class. This has allowed many upper-class individuals to flex their equity and apply it to more real estate investments. Ultimately, this means those who purchased homes under favorable rates now make up large portions of the upper class and have contributed to what the Pew Research Center says is a shrinking middle class.
The world's richest people share a similar investment strategy, focusing on diversification of assets. One way to do this is by investing in private equity and credit firms like Blackstone Inc., which have diverse holdings and operations. That said, large portions of these private firms are investing in real estate via residential transition loans. Inequality.org says these loans are for home flippers who looking to increase real estate value, and allow firms to profit from this trend in the real estate market.