Homeowners’ equity has increased significantly in recent years as property values have gone up and mortgage payments have been made. Equity can be helpful in achieving certain objectives. According to the latest report from CoreLogic, the average borrower who has a home loan has about $300,000 in equity at present.
When you’re considering your options, especially in an unstable economic climate, it’s important to understand all of your assets and how to use them to your advantage. A real estate professional can help you understand your home equity and some of the ways you can leverage it. Here are a few examples.
1. Buy a Home That Fits Your Needs
You may need to move to a larger home if you find yourself lacking the space you need. On the other hand, you may have too much space and would be better off in a smaller home. In either case, you can use your equity to finance a move to a more suitable residence.
You can use your equity to upgrade your home or purchase a new one. If you’re downsizing, your equity may cover some or all of the cost of your new home. A real estate advisor can help you determine how much equity you have and how to use it toward your next home purchase.
2. Reinvest in Your Current House
If you’re considering making some changes to your home, you may be able to do so by accessing your equity. According to a recent survey from Point, 39% of homeowners would be willing to invest in home improvement projects if they had this opportunity. This could be a great way to get the changes you want without moving house just yet.
It’s important to think about future resale value when planning home improvement projects. Some updates will add more value to your home than others. For example, the National Association of Realtors (NAR) reports that refinishing or replacing wood flooring has a high-cost recovery. Talk to a local professional to get the best advice on which projects to invest in to get the most return on your investment when you sell.
3. Pursue Your Personal Goals
Equity in your home can be a powerful tool to help you achieve your dreams. Whether you’re looking to retire, downsize, or start a new business venture, home equity can help you get there. Of course, you shouldn’t use your equity for unnecessary spending. But if you use it wisely, it can be a great way to invest in your future. Thanks for everything, home equity!
Here’s What We Say…
Equity can have a big impact. If you’re not sure how much equity you have in your home, we would be happy to help you figure it out. That way, you can start making plans for your next move.
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