According to the latest Federal Reserve Financial Accounts report, equities now represent 39.9% of total US household net worth, marking the highest level on record. In contrast, residential real estate equity has declined to 19.3%. This creates a gap of 20.6 percentage points between the two asset classes, a significant shift from historical trends where real estate often held a larger share.
The total net worth of US households reached $185.65 trillion. Of this amount, corporate equities account for $74.03 trillion, while residential real estate equity stands at $35.81 trillion. Since the third quarter of 2022, equity exposure has increased by 12.6 percentage points, whereas housing exposure has decreased by 3.5 percentage points.
Market performance has driven this divergence, as the Nasdaq Composite hit a record 27,122.09 points, reflecting a 16.7% annual gain. The S&P 500 rose 13.4% in 2026. Conversely, the Case-Shiller national home price index grew by only 1.5% through June, which, when adjusted for 3.5% inflation, indicates a decline in real home values for 13 consecutive months.
Financial institutions maintain varying outlooks for the S&P 500 for the remainder of the year, with targets ranging from 7,400 to 8,100. Bank of America has set the lowest target at 7,400, suggesting a potential 4.7% decline from recent levels. Analysts from UBS, Citigroup, Oppenheimer, and HSBC have provided the highest projections within this range.
