Your net worth is a powerful tool that can help you achieve your goals as a homeowner. And chances are your equity has increased significantly in the past year. According to CoreLogic's latest Equity Insights report, owners have earned an average of $51,500 in equity over the past year.
If you're looking for the best ways to use your growing equity, here are four options:
1. Use equity to buy a home that meets your needs
If you find that you are running out of space that you need, it may be time to move into a larger home. Or, it could be that you have too much space and want something smaller. Either way, consider using your equity to move into a home that fits your changing lifestyle. Moving to a larger home can provide extra space for remote work or for loved ones. On the other hand, downsizing can mean saving time and money by aiming for a smaller home.
2. Moving to Your Dream Location
If the size of your home isn't a challenge but your current location is, it may be time to move to a new area. Maybe you enjoy a vacation in the mountains, on the beach, or somewhere else, and you dream of living there year-round. Or maybe the distance between you and your loved ones is bigger than you would like and you want to bridge the gap. Either way, the equity in your home can spur your move to where you really want to live.
3. Starting a New Business
If you are not ready to move into a new home, you can use your equity to invest in a new business venture. As the US Small Business Administration's Advocacy Office states:
“There are an estimated 31.7 million small business owners in the United States, many of whom have already started businesses. with their own capital from their house.
While homeowners are discouraged from using their equity for unnecessary expenses, leveraging your equity to start a business you are passionate about has the potential to develop your nest.
4. Educational support
Whether you have a loved one who is preparing for college or is thinking about going back to school on their own, the thought of paying for college can be daunting. Either way, using a growing portion of your equity can help cover these costs, allowing you to invest in someone's future.
Your capital can help you achieve your goals. If you're unsure about your home equity property, contact a trusted real estate advisor so you can start planning your next move.
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