Reaching the age of retirement is a big deal for anyone. You know the usual saying: when one door closes, another one opens? Well, that quote fits well here, as opportunities often knock. One thing you might be thinking about during this phase is selling your home. Finding a place that better fits your new lifestyle and needs is usually the end-term goal. The great news? Making that first step might be easier than you might think, especially with your current Home Equity.
Think About the Length of Time You’ve Owned Your Home
In the past, between 1985 and 2009, homeowners typically held onto their properties for about six years on average. Fast forward to the present, and you’ll find that the game has changed. Let’s refer to the data below from the National Association of Realtors (NAR). It indicates that since 2010, the average length of homeownership has stretched to just a little over nine years.
In recent years, many homeowners have found themselves staying in their properties for a longer period of time. During such a lengthy residency and the tenure of staying in your home, life just doesn’t stand still.
It gradually evolves, bringing with it new milestones, challenges, and some shifts in your needs. If you discover that your current residence isn’t aligning with your changing lifestyle, don’t worry. There could be a home out there that’s a better fit for your new set of requirements. Usually, there are options for upsizing or downsizing, depending on what you’re looking for.
A Deep Dive into Equity and Discovering Untapped Wealth
If you’ve been residing in your home for an extended period of time, chances are you’ve amassed a considerable amount of equity already that can serve as a financial springboard for your next property venture. This equity accumulates in two key ways: first, through the gradual reduction of your current mortgage balance, and second, appreciation in your home’s value over time. Usually through home renovations and improvements throughout the years. The longer you’ve lived in your residence, the more financial gains you stand to reap. It’s more like you reap what you sow kind of saying.
To underscore this point, statistics from the Federal Housing Finance Agency (FHFA) offer illuminating insights, as depicted in the graph below:
In various local markets, home prices can certainly differ depending on which state you currently live in. Yet, nationally speaking, the data is compelling: homeowners who’ve settled into their residences for about five years have witnessed a remarkable 60% uptick in their home value. If you’ve been a long-term investor in your own home, say for around three decades, your property’s value has likely close to tripled during that period.
Whether you’re contemplating downsizing, considering relocating to your dream neighborhood or just yearning to be nearer to your social circle, that built-up equity can serve as a financial lever in your next move.
Your housing aspirations are totally achievable at the end of the day, and finding the right real estate agent can be a key instrument in that journey. The real estate agent you’re looking for doesn’t just help you list your existing home; they’re also your partner in getting the next property that aligns with your ideal lifestyle and future ambitions.
As you plan your retirement journey, the importance of understanding your home equity cannot be overstated well enough. Let’s come together to assess the home equity you’ve managed to build over time, and let’s strategically align it with your current housing needs. With detailed planning and the right real estate agent by your side, we can use this as a cornerstone of your future dream home.
Please don’t hesitate to reach out to the McT Real Estate Group for a one-on-one personalized consultation on optimizing your real estate assets and planning your retirement ahead.