Americans' total wealth has reached a record high.
Tom Merton—Getty Images
By Kerry Close
June 9, 2016

Perhaps counterintuitively, Americans are wealthier than ever.

Total wealth reached a record high of $88.1 trillion in the first quarter of 2016, according to a report from the Federal Reserve released Thursday. Increasing home values bolstered the collective net worth of Americans and offset stock market dips at the beginning of the year, the Wall Street Journal reported. A $498 billion increase in residential real-estate values propelled the wealth increase, while the overall value of equities declined by $160 billion.

While assets like stocks and bonds are held disproportionately by the wealthiest U.S. households, homes are more broadly owned by middle-income households. Since nearly two-thirds of Americans own homes, an increase in home prices has helped many middle-tier households.

In recent years, mortgage balances and home prices have increased at a steady clip. The total home equity that Americans have in real estate has almost recovered to its level at the height of the housing bubble, surpassing $13 trillion in the most recent report.

The report, called “Flow of Funds,” tracks the total balance sheet of U.S. households to show how the moving parts of wealth shift over time. It does not show a breakdown of the distribution of these assets among individual households or different demographic groups.

Another key difference in American household finance since the crisis: People aren’t taking on as much debt. Total liabilities rose by just $17 billion in the first quarter, and remain at a lower level than during the financial crisis.

Other data, however, suggests that most people in the U.S. are seeing their net worth and income decline, in inflation-adjusted terms, in recent years. Any gains in wealth have instead been concentrated among the wealthy. The middle class has been hit particularly hard: While the share of total wealth going to middle-income households was 62% in 1970, it’s fallen to about 43% in , according to the Pew Research Center.

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