Recently there has been a lot of talk about home prices and if they are accelerating too quickly. In Denver and many other areas of the country seller supply (homes for sale) cannot keep up with the number of buyers out looking for a home, which has caused prices to rise.
The great news about rising prices, however, is that according to CoreLogic’s US Economic Outlook, the average American household gained over $11,000 in equity over the course of the last year, largely due to home value increases. Homeowners in Denver, on average are in an even better situation with an average equity gain two to three times this in their home equity.
I wanted to be able to put this into a relatable example for my clients who are considering purchasing a home or as a current homeowner. Lets assume you purchased a home in January 2017, if we look at only the projected increase in the price of that home, how much equity will you earn over the next 5 years?
Over a five-year period, your equity will increase by over $69,000! This figures does not even take into account their monthly principal mortgage payments, tax deductions, or any home improvements.
Bottom Line: Not only is homeownership something to be proud of, but having a better understanding of your home equity can open up many doors. Maybe you’re a homeowner looking to take advantage of your home equity by moving up to your dream home. Maybe you want to leverage your home equity to buy an rental property or second home. Or maybe it’s the missing link in how to finance that kitchen remodel you’ve been dreaming about. Lets get together to discuss your options!
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