Real median net worth surged a whopping 37% between 2019 and 2022, the Federal Reserve revealed in a report.
The Fed released a 58-page report on Wednesday analyzing changes in family finances based on its survey of consumer finances, which it has been conducting every three years since 1989. The newest report is of particular interest because it assesses a period that includes the coronavirus pandemic and the country’s worst inflation in decades.
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From 2019 to last year, real median net worth — that is, net worth adjusted for inflation — went up by 37% to $192,900, while real mean net worth increased 23% to just over $1 million. That huge uptick adds to the “steady growth” in real net worth that was notched from 2013 to 2019, according to central bank researchers.
“The net improvements in economic performance, including rising house and corporate equity prices that well exceeded consumer price inflation, supported substantial increases in median and mean inflation-adjusted net worth,” the Fed report read.
Inflation exploded during the period tracked by the Fed. The housing market, fueled by red-hot demand and ultra-low mortgage rates, also had one of the biggest boom cycles in recorded history, and during that period, home prices skyrocketed in value, likely a major factor behind the big net worth increases.
The report noted the average sales price of a house sold in the United States increased by a staggering 44% from the fourth quarter of 2019 to the fourth quarter of last year.
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Meanwhile, income also rose over the past few years. From 2018 to 2021, median income rose at a relatively modest 3% pace, although, during that same period, mean income grew 15%, from $123,400 in 2018 to nearly $142,000 in 2021.
“Gains in income were experienced across the income distribution but were largest toward the top, consistent with some increase in income inequality over this period,” the Fed report concluded.