While watching the stock market recently may have taken you on a rollercoaster ride, checking the value of your Boston condo should come as welcome relief in this volatile time. If you’re a Boston condo owner, your net worth dramatically increased over the past few years thanks to national rising home prices. And that increase in your wealth came in the form of home equity. Here’s how it works.
Home equity is the current value of your home minus what you owe on the loan. Because of the Massachusetts booming economy number of Boston condo buyers with high wages looking to make a purchase over the past few years, Boston condo sale prices have appreciated substantially. And while mortgage rates have cooled the market some in recent months, home prices nationally and locally have remained strong.
That’s why, according to the latest Homeowner Equity Insights from CoreLogic, the average homeowner equity has grown by $60,000 over the last 12 months. While that’s the national number, even more so in Massachusetts where it ha grown by $65,000 as you can see from the map below from CoreLogic:
Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), helps explain how home equity doing compared to stock market:
“. . . the decline in the stock market has dented overall net wealth. It has fallen by $6 trillion from the first to the second quarter. Only housing wealth has held on, with homeowners’ real estate wealth (home value minus mortgage balance) rising by $1.2 trillion.”
While equity helps increase your overall net worth, it can also help you achieve other goals like buying your next home. When you sell your current house, the equity you built up comes back to you in the sale, and it may be just what you need to cover a large portion – if not all – of the down payment on your next home.
There’s volatility in today’s stock market, but home equity is still incredibly strong. To find out just how much equity you have in your current home, let’s connect.