Building equity in your home is one of the biggest financial advantages of homeownership. Right now, homeowners across the country are sitting on record amounts of equity, and it could be the key to buying your next home in cash.
Here’s a look at how your home equity could be a game changer, shifting your perspective from “Why would I move right now?” to “Why wouldn’t I?”
What Is Home Equity?
Home equity is the difference between how much your house is worth and how much you still owe on your mortgage. For example, if your home is valued at $400,000 and you owe $200,000 on your mortgage, your equity would be $200,000.
Why Home Equity Is a Big Deal for Sellers
Recent data from the U.S. Census Bureau and ATTOM shows just how significant today’s home equity really is. In fact, more than two out of three homeowners have either completely paid off their mortgages or have at least 50% equity in their homes.
And that’s a big deal. According to CoreLogic, the average homeowner has $311,000 worth of equity built up. That kind of net worth can go a long way if you’re planning to make a move.
The Rise of All-Cash Buyers
This surge in equity is part of the reason why the share of all-cash buyers recently reached a new high. According to the National Association of Realtors (NAR), 26% of buyers were able to purchase a home without a mortgage.
Imagine buying your next house in cash:
- No mortgage
- No monthly payments
- No interest rates to worry about
If you want to find out how much equity you have, connect with a real estate agent and ask for a Professional Equity Assessment Report (PEAR). You might discover you have enough equity to buy your next home outright. And with today’s mortgage rates, not needing a loan can be a huge financial win.
Even if you don’t have enough equity to buy in all cash, you might still have enough to make a larger down payment, which comes with its own set of benefits, such as lower monthly payments and better loan terms.
Bottom Line
Homeowners have an incredible amount of equity today, and that’s why the share of all-cash buyers is on the rise. To see how much equity you have and explore how it can help fuel your next move, let’s connect.
