Moving Up to Your Dream Home: Why Now Could Be the Right Time

If you’re ready to upgrade to a larger or more luxurious home, you’re not alone. A recent Inman survey highlights that a major motivator for today’s homebuyers is the desire for more space or to improve their living situation. However, like many, you may have hesitated due to recent housing market challenges. With the right planning, now could be the perfect time to make your dream move.

1. Your Home Equity Can Make Upgrading Easier

One of the greatest advantages for current homeowners is the equity they’ve likely accumulated over the years. Home values have continued to grow despite market fluctuations, which means homeowners can leverage significant equity. As Selma Hepp, Chief Economist at CoreLogic points out:

“Persistent home price growth has continued to fuel home equity gains for existing homeowners, who now average about $315,000 in equity, nearly $129,000 more than at the onset of the pandemic.”

If you’ve been in your home for a few years, chances are you have a substantial amount of equity built up. This equity can go a long way toward a down payment, reducing the amount you need to borrow. For a clear assessment of your home’s value, consider getting a professional equity assessment from your real estate agent.

2. Recent Mortgage Rate Drops Are in Your Favor

Mortgage rates have been trending downward, which can have a significant impact on both your purchasing power and monthly payments. Lower rates make it easier to manage monthly costs and can broaden the price range you’re able to consider. As Nadia Evangelou, Senior Economist at the National Association of Realtors (NAR), explains:

“When mortgage rates fall, the interest portion of monthly payments decreases, which lowers the total payment, making it easier for more borrowers to qualify for mortgages that may have been unaffordable at higher rates.”

This could mean that the home you once thought out of reach might now be affordable. A trusted lender can help calculate your options and find a rate that fits within your budget.

Bottom Line

If you’re thinking of selling your current home to buy a larger or nicer one, this could be an ideal time. With substantial home equity and favorable mortgage rates, you’re well-positioned to take advantage of today’s market.

Ready to explore your options? Connect with a real estate professional to navigate the market and find the home that fits your dreams.

FAQs

Q: What is home equity, and how does it help with upgrading my home?
A: Home equity is the portion of your property’s value that you own outright, often built over time as property values appreciate. This equity can be used as a down payment on your next home, reducing the amount you need to borrow.

Q: How do mortgage rates affect my ability to buy a new home?
A: Lower mortgage rates reduce the interest portion of your monthly payments, making the overall payment more manageable. This also increases your purchasing power, potentially allowing you to afford a more desirable home.

Q: What is a professional equity assessment, and why should I get one?
A: A professional equity assessment is an evaluation of your home’s current market value, which helps determine how much equity you have. A real estate agent can help you with this, giving you a clearer idea of how much you could put towards a new property.

Sources:

• Homeowner Equity Insights - Core Logic

• The Upcoming Rate Cut: 5 Things Homebuyers Need to Know - NAR

• Top Motivators for Homebuyers - Inman