Here’s why you need to regularly check how much equity you have.
Today, I’m excited to discuss something we truly enjoy doing with our clients—an annual home equity update. Our clients’ homes, as well as our own, represent some of our most significant investments.
While not everyone views their home as an investment, the truth is that it holds substantial value for nearly every American. For most people in the country, their home is where they build their wealth. However, unlike other investments, we often don’t give our homes the attention they deserve in terms of assessing their worth and understanding the value they bring us.
Recently, I met with my financial advisor, and she asked me about the value I had in my home. As a real estate agent, I realized I didn’t have a precise figure to provide her, so I had to go find that information. This experience underscores the importance of regularly assessing the equity in your home.
This is why we strongly recommend and love conducting annual equity updates for our clients. During these updates, we take a close look at what you’ve done with your home over the past year and provide you with an accurate estimate of the value gain or loss. It’s crucial to note that historically, home values tend to increase in a typical market. In Lincoln, Nebraska, for instance, the average home appreciates between $10,000 and $50,000 in value each year.
“Assessing your equity regularly is crucial.”
Consider this: Your home essentially earned you a significant salary last year, possibly $40,000 to $50,000, without you even realizing it. Many homeowners fall into the trap of relying on their county assessor’s assessment to determine their home’s value. In reality, these assessments are often far lower than the actual market value.
We conducted a study at Lincoln Select and compared the selling prices of the last 100 homes we sold to their county-assessed values listed in the MLS. Surprisingly, we found that, on average, the county assessments were 30% lower than the actual selling prices.
So, having an annual home equity update should be an exciting event on your calendar. It provides you with insights into your home’s worth and equity. If you’re curious about your home’s value and don’t want to wait until you’re ready to sell, please call or email us. We’d be delighted to visit your home and discuss its current value and equity to support your financial goals.