If you’ve been thinking about selling your current home to upgrade to a larger or more luxurious one, you’re in good company. According to a recent Inman survey, the primary reason motivating today’s homebuyers is the need for more space or a home upgrade (see graph below):
Like many others, you may have delayed your plans to upgrade due to recent market challenges—and that’s understandable. When moving up to a larger or more luxurious home, affordability is a major factor. The good news is, now is actually a great time to make that move happen. Here’s why:
1. You’ve Built Substantial Equity
One of the biggest advantages you have right now is the amount of equity you’ve likely accumulated in your current home. Despite recent shifts, home prices have steadily increased nationwide, adding to the equity homeowners hold today. As Selma Hepp, Chief Economist at CoreLogic, explains:
“Persistent home price growth has continued to fuel home equity gains for existing homeowners who now average about $315,000 in equity and almost $129,000 more than at the onset of the pandemic.”
If you’ve been in your home for a few years, you’re probably sitting on a significant amount of equity. This can be a game-changer, allowing you to use it as a substantial down payment on your next home—keeping your loan amount more manageable.
Curious how much equity you’ve built up? A professional equity assessment from a real estate agent can give you the answers.
2. Mortgage Rates Are Falling, Increasing Your Buying Power
Another reason why now is a great time to upgrade: mortgage rates are on a downward trend. Lower rates can reduce your future monthly payments and increase your overall purchasing power. Nadia Evangelou, Senior Economist and Director of Real Estate Research at the National Association of Realtors (NAR), says:
“When mortgage rates fall, the interest portion of monthly payments decreases, which lowers the total payment. This makes it easier for more borrowers to . . . qualify for mortgages that may have been unaffordable at higher rates.”
This added flexibility could allow you to afford a home that may have been beyond reach just a short time ago. A trusted lender can help you understand how today’s rates can work in your favor.
Bottom Line
If you’re ready to move into the bigger, nicer home you’ve been dreaming of, don’t wait. With the equity you’ve built and lower mortgage rates on your side, you’re in a strong position to make that move today.
Let’s connect to ensure you have an expert by your side every step of the way, guiding you through the homebuying process to maximize your opportunities.