Despite the moderation of home prices in the past year, numerous homeowners continue to possess a substantial amount of equity. However, it's important to understand what equity actually means. Put simply, equity refers to the disparity between the market value of your home and the outstanding amount you owe on your mortgage. The National Association of Realtors (NAR) explains how your equity grows over time:

“Housing wealth (home equity or net worth) gains are built up through price appreciation and by paying off the mortgage.”

How Your Equity Can Help You Achieve Your Goals

The accumulated equity over time can serve as a valuable asset when you decide to sell your current house and transition into your next home. Whether you require more space or find yourself with an excess of it, your equity can play a significant role. Regardless of the circumstances, your equity can serve as a potent resource to facilitate your move in the present real estate market. This is due to the possibility that your equity could cover a portion, if not all, of the down payment required for your next home.

You might be pleasantly surprised by the extent of your equity. According to a recent survey conducted by Realtor.com, numerous homeowners currently believe they have accumulated a substantial amount of equity.

The latest data from CoreLogic helps solidify why homeowners are feeling so good about the equity they’ve likely gained over time. As Selma Hepp, Chief Economist for CoreLogic, says:

“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.”

How a Skilled Real Estate Agent Can Help

If your goal is to utilize your equity to enhance your purchasing capability in the current market, the presence of a reliable agent can make a significant impact.

Engaging the services of a real estate professional can provide valuable insights into your home's value, offering you a clearer understanding of the probable amount of equity you have. In line with a recent article from Bankrate:

“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.” 

Gaining a comprehensive comprehension of your equity is crucial when making decisions about buying or selling a home. A proficient agent can assist you in navigating the frequently intricate process of selling your house and ensure a seamless transaction.

Bottom Line

In the present day, numerous homeowners find themselves in possession of a considerable amount of equity, and it is possible that you are among them. Let's get in touch to determine an estimate of your equity and strategize how you can leverage it towards acquiring your next home.