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Have you ever considered just how much wealth you’ve built simply by owning a home? As property values rise, so does your net worth. If you’ve been in your home for a few years—or longer—you might be sitting on a significant amount of home equity, possibly more than you realize.
What Is Home Equity?
Home equity is the difference between your home’s market value and what you owe on your mortgage. For instance, if your home is valued at $500,000 and your remaining mortgage balance is $200,000, you’ve built up $300,000 in equity. It’s like a financial nest egg that grows while you live your life.
Today, homeowners across the country are experiencing record levels of equity. According to Intercontinental Exchange (ICE), the average homeowner with a mortgage has $319,000 in equity.
Why Are Homeowners Seeing So Much Equity Growth?
Two key factors contribute to this surge in equity:
Over the past few years, home prices have soared. Data from the Federal Housing Finance Agency (FHFA) shows that nationwide, home prices have risen an astonishing 57.4% over the past five years. That means your home could be worth significantly more today than when you purchased it.
Homeowners are staying put longer than they used to. According to the National Association of Realtors (NAR), the average tenure in a home is now 10 years. This extended period allows homeowners to benefit from long-term price appreciation.
In fact, NAR reports that over the past decade, the typical homeowner has gained $201,600 in wealth just from home price growth.
The Benefits of Home Equity
Your home equity isn’t just a number on paper—it’s a powerful financial tool that can open up exciting possibilities. Here are some ways to leverage it:
Your equity can help fund your next move. It might cover the down payment for a new property or even enable you to purchase your next home outright in cash.
Dreaming of a new kitchen, a dedicated home office, or a backyard oasis? Your equity can provide the funds to make those improvements, enhancing your home’s value and enjoyment.
Thinking of launching your own business? Whether it’s for startup costs, equipment, or marketing, your home equity can give you the financial boost to turn your entrepreneurial dreams into reality.
What’s Next for You?
Your home might be one of your most valuable assets, offering you financial flexibility and options for the future. Whether you’re looking to sell, upgrade, or simply explore your possibilities, understanding and utilizing your equity is key.
Curious about how much equity you’ve built or how to make the most of it? The Marion DeSantis Team is here to help. Let’s connect to discuss your options and create a plan tailored to your goals.
Your home equity is more than just wealth—it’s opportunity. Let’s unlock its potential together.
