Tuesday, January 11, 2022 / by Flr Team
When you think of homeownership, the first thing that comes to mind might be the security or stability a home provides. But what about equity? A homeowner’s equity helps build long-term wealth over time. Here’s a look at what equity is and why it matters:
For a homeowner, your equity is the current value of your home minus what you owe on the loan. So, as home values rise, your equity does too, and that’s exactly what is happening today. There currently aren’t enough homes on the market for the number of buyers, so bidding wars and multiple offers are driving prices up. People are willing to pay more to buy a home, and this low supply and high demand are giving current homeowners a significant equity boost.
How much have the rising home prices impacted equity? According to a report from CoreLogic, the national average of homeowner’s equity has grown by $56,700 over the last 12 months. The state of Florida alone has grown even more at an average of $64,000!
How does this impact you? If you’re already a homeowner, equity not only builds your wealth, it also opens doors for you to achieve your goals. When you sell your home, the equity you built up comes back to you in the sale. You can use those proceeds to help with your next move.
If you’re thinking about becoming a homeowner, understanding the importance of equity can help you realize why homeownership is a worthwhile goal. It builds your wealth and gives you peace of mind that your investment is a wise one, not just for your lifestyle, but also financially too.
Whether you’re a current homeowner or you’re ready to become one, and this has inspired you to make a move, our team at Florida Lifestyle Realty can help you explore your options and find out what steps you need to take next.
Florida Lifestyle Realty