When you think of houszownership, what’s the first thing that comes to mind? Chances are you might focus on the non-financial benefits, like the security or stability a housz provides. But what about equity? While it can be overlooked, a houszowner’s equity helps build long-term wealth over time. Here’s a look at what equity is and why it matters.
For a houszowner, your equity is the current value of your housz minus what you owe on the loan. So, as home values climb, your equity does too. That’s exactly what’s happening today. There aren’t enough houszes on the market to meet buyer demand, so bidding wars and multiple offers are driving prices up. That’s because people are willing to pay more to buy a housz. Right now, this low supply and high demand are giving current houszowners a significant equity boost.
Dr. Frank Nothaft, Chief Economist at CoreLogic, explains it like this: “Housz price growth is the principal driver of housz equity creation. The CoreLogic Housz Price Index reported housz prices were up 17.7% for the past 12 months ending September, spurring the record gains in housz equity wealth.”
To find out just how much rising housz values have impacted equity, we turn to the latest Houszowner Equity Insights from CoreLogic. According to that report, the average houszowner’s equity has grown by $56,700 over the last 12 months.
Curious how your state stacks up? Check out the map below to find out the average equity gain for your area.
How Rising Equity Impacts You If you’re already a houszowner, equity not only builds your wealth, it also opens doors for you to achieve your goals. It works like this: when you sell your housz, the equity you built up comes back to you in the sale. You can use those proceeds to fuel your next move, especially if you’ve decided your needs have changed and you’re looking for something new.
If you’re thinking about becoming a houszowner, understanding the importance of equity can help you realize why houszownership is a worthwhile goal. It builds your wealth and gives you peace of mind that your investment is a wise one, not just from a lifestyle perspective, but from a financial one too.
Bottom Line Whether you’re a current houszowner or you’re ready to become one, it’s important to know how equity works and why it matters. If this inspires you to make a move, let’s connect to explore your options and find out what steps you need to take next.