Know this: Unless you’re living somewhere rent-free, you’re paying a mortgage – either yours or your landlord’s. Buying your own home provides you with a form of ‘forced savings’ that allows you to use your monthly housing costs to increase your family’s wealth. Team Nest Builder explains how this works:
Every month you pay your mortgage, you’re paying off a portion of the debt you took on to purchase your home. Therefore, you own a little bit more of your home every month in the form of home equity. As your home’s value increases, you also gain home equity.
Every quarter, Pulsenomics surveys a nationwide panel of over 100 economists, real estate experts, and investment and market strategists. They’re asked to project how residential home prices will appreciate over the next five years for their Home Price Expectation Survey (HPES).
The latest data from their Q1 2019 Survey revealed that home prices are expected to round out the year 4.3% higher than they were in January. For the next 5 years, home values will appreciate by an average of 3.21% a year.
This is great news for homeowners!
For example, let’s assume a young couple purchased and closed on a $250,000. home in January of this year. Simply through their home appreciating in value, those homeowners can build their home equity by over $40,000. over the next five years!
Let’s look at the potential equity gained over the same period of time at some higher price points:
In many cases, home equity is a large portion of a family’s overall net worth.
Whether it’s your first or your fifth, if your plan for this year includes buying a home, call Team Nest Builder’s Lynn Garafola at 973-222-3777 today to get started!
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