Unearthing the Potential of Home Equity in Today’s Market
In today’s real estate climate, it’s impossible to ignore the significant advantage many homeowners have in the form of home equity. Despite the moderation in home prices in recent times, the amount of equity many homeowners possess remains substantial. But before we delve deeper, it’s essential to understand the concept of equity. At its core, equity is the calculated difference between your home’s market value and the sum you still owe on your mortgage. According to the National Association of Realtors (NAR), equity or housing wealth gains are accrued through both the home’s price appreciation and by gradually paying off the mortgage.
The Power of Equity in Fulfilling Your Aspirations
The equity that homeowners accumulate over the years can serve as a powerful financial tool. If you’re considering selling your current property and buying a new one, your equity could be your most significant asset. For instance, if you’re outgrowing your current home or conversely, if it’s getting too large for your needs, your equity could potentially cover a substantial portion, if not all, of the down payment on your next property.
Most People Believe They Have A Lot of Equity in Their Homes – They Are Correct
An impressive amount of equity is not uncommon among homeowners today. A recent survey conducted by Realtor.com reveals that many homeowners believe they have accumulated a substantial equity stake in their homes.
Evidence of Significant Equity Gains
Data from CoreLogic further strengthens the notion of substantial equity accumulation by homeowners. Selma Hepp, Chief Economist for CoreLogic, highlights this trend, stating, “While equity gains contracted in late 2022 due to home price declines in some regions, U.S. homeowners on average still have about $270,000 in equity, nearly $90,000 more than they had at the onset of the pandemic.”
The Role of a Competent Real Estate Agent
To make the most of your equity and enhance your purchasing power in today’s market, a competent real estate agent can be your most valuable ally. Such a professional can provide you with a realistic estimate of your home’s value, offering a clear perspective on your likely equity. Bankrate recently emphasized the importance of this in an article, stating, “Hiring a skilled real estate agent can give you a realistic estimate of home prices in your area and how to price your current home. Using that figure, you can calculate how much equity you have and what your net proceeds will look like, so you can apply that money toward the down payment and closing costs of your new home.”
Make Sure You Find the Best Realtor for Your Needs
Having a thorough comprehension of your equity is crucial when making decisions about buying or selling your home. A proficient agent can guide you through the often-complex process of selling your property and ensure the transaction proceeds without a hitch.
It Just Might Be a Great Time to Sell
Presently, a vast number of homeowners are sitting on considerable equity, and you could very well be one of them. A real estate agent can provide an accurate estimate of your equity and guide you in planning its utilization towards the purchase of your next home.