Source: Keeping Current Matters

 

If you own a home, your net worth has probably seen a significant increase over the past 12 months. With home prices climbing, you're building equity more rapidly than you might have realized. Take a closer look:

Equity represents the current market value of your home minus the remaining balance on your mortgage. Over the past year, the demand for homes has been higher than the number of homes for sale which has driven prices up. This rise in home values has directly resulted in increased equity for homeowners.

 

How Much Equity Have You Gained Over the Past Year?

The latest Homeowner Equity Insights from CoreLogic shows that the average homeowner's equity has risen by $28,000 in just the past year.

This figure represents the national average, but if you're curious about what’s going on in your state, check out the map below. It uses CoreLogic data to show how much equity has grown in each state over the past 12 months. You'll see that every state with sufficient data has experienced annual equity gains.

 

What Happened If You Bought Your House Before the Pandemic?

If you purchased your home before the pandemic, the equity news is even more favorable. As Realtor.com data shows, home prices sky-rocketed by a whopping 37.5% from May 2019 to May 2024, meaning your home's value has risen significantly. Ralph McLaughlin, Senior Economist at Realtor.com, comments:

“Homeowners have seen extraordinary gains in home equity over the past five years.”

To put this into perspective, Selma Hepp, Chief Economist at CoreLogic, describes the total equity the typical homeowner has today:

“With home prices continuing to reach new highs, owners are also seeing their equity approach the historic peaks of 2023, close to a total of $305,000 per owner.”

How Your Increasing Home Equity Can Benefit You

With the dramatic increase in home prices over the past few years and ongoing growth, homeowners have accumulated substantial equity, which comes with several advantages.

This equity can be used to start a business, fund education, or help finance your next home. When you sell, the equity you've built up can be returned to you, potentially covering a large portion—or even all—of your next home's down payment.

In Summary

If you're thinking of making a move, the equity you've gained can be very helpful when buying your next home. Contact us today to find out how much equity you have now and how it can help finance your next home.