Keeping Current Matters February 10, 2024
Seller
Are you on the fence about selling your house? While affordability is improving this year, it’s still tight. And that may be on your mind. But understanding your home equity could be the key to making your decision easier. An article from Bank rate explains:
“Home equity is the difference between your home's value and the amount you still owe on your mortgage. It represents the paid-off portion of your home.
You'll start off with a certain level of equity when you make your down payment to buy the home, then continue to build equity as you pay down your mortgage. You'll also build equity over time as your home's value increases.”
Think of equity as a simple math equation. It's the value of your home now minus what you owe on your mortgage. And guess what? Recently, your equity has probably grown more than you think.
In the past few years, home prices skyrocketed, which means your home's value – and your equity – likely shot up, too. So, you may have more equity than you realize.
If you're thinking about moving, the equity you have in your home could be a big help. According to CoreLogic:
“. . . the average U.S. homeowner with a mortgage still has more than $300,000 in equity . . .”
Clearly, homeowners have a lot of equity right now. And the latest data from the Census and ATTOM shows over two-thirds of homeowners have either completely paid off their mortgages (shown in green in the chart below) or have at least 50% equity (shown in blue in the chart below):
That means roughly 70% have a tremendous amount of equity right now.
After you sell your house, you can use your equity to help you buy your next home. Here’s how:
“You may want to pay cash for your home if you're shopping in a competitive housing market, or if you'd like to save money on mortgage interest. It could help you close a deal and beat out other buyers.”
“Borrowers who put down more money typically receive better interest rates from lenders. This is due to the fact that a larger down payment lowers the lender’s risk because the borrower has more equity in the home from the beginning.”
To find out how much equity you have in your home, ask a real estate agent you trust for a Professional Equity Assessment Report (PEAR).
Planning a move? Your home equity can really help you out. Let’s connect to see how much equity you have and how it can help with your next home.
Stay up to date on the latest real estate trends.
January 17, 2025
If the idea of moving abroad has recently seemed a lot more appealing due to current events—you’re not alone.
January 17, 2025
January 1st is a fresh start. When the clock strikes midnight, no matter how many times you continue to mistakenly write 2024 instead of 2025, the new year is upon us.
January 17, 2025
Many people dream of moving abroad, whether it's to experience a different culture, a desire for a slower life, or as am escape from the ever changing political climat… Read more
January 17, 2025
There’s one essential step in the homebuying process you may not know a whole lot about and that’s pre-approval. Here’s a rundown of what it is and why it’s so importa… Read more
January 17, 2025
January 16, 2025
Having too much space sounds like the kind of problem we all wish we had. But in the case of this 17,200-square-foot house in Westlake, Texas, a suburb of Dallas, the … Read more
We Guide Homeowners through the complicated process of selling their home using our 4 Phase Selling Process and 3 Prong Marketing Strategy that alleviates their stress and moves them effortlessly to their next destination. Schedule a 15 Minute Complimentary Strategy Session Today