Home Equity at a 4 Yr High

Full Video Transcript Below

Home Equity 4 Yr High

Alice Lema: [00:00:00] Well, hey, everybody. Welcome back to the weekly podcast. I'm Alice Lema. I'm a broker with John L. Scott in Southern Oregon. And today we're going to talk about how we have nationally a four year high in equity. So I want to show you this graph. This is from Adam ATTOM and they have Published this recently and it's very interesting because you can see it goes back to the first quarter of 2020, which was during COVID.

And then you can see the run up of prices in equity. And then it's, it's kind of trying to level off, which is our experience here in Southern Oregon. These happen to be national numbers. But it's very exciting that we have an increase of almost 50% five zero and that's that's huge. So we call those a unicorn years we don't see that being repeated again.

However, now that we know that we [00:01:00] have all this extra money in our houses and your house will be different and we have to run your house in particular to be sure exactly how much equity you have. But now that we know we have this big pile of value, let's talk about a couple of things you can do with that equity, besides just calm and joy, knowing that you are that much, you have that much more wealth in your life. So one of the first things I'd like you to consider is if you took a mortgage out to make your purchase and you did not put 20% down, which most people don't, then you might be in a position to get rid of the mortgage insurance that you've been paying every month in your monthly payment.

Now, how that works is we contact your lender where you probably get me or some other real estate agent to double check real quick because we have access to the same numbers that the appraisers do. Let me double check that you're close or you're over that 20 percent [00:02:00] mark. And then we can have you call your lender.

The lender is the final authority, but it's nice to double check before you pay for an appraiser because that's what they do. The appraiser comes out and says, Yes, you are worth more than 20% than your purchase and will take off your mortgage insurance. So that's a very exciting moment. So let's talk about maybe doing that if you're going to keep the property.

Number two is, you could end up with a mega down payment for another purchase. And this would be in case you don't love the house you're in. You could sell the house and have this giant down payment, which is super helpful in a high interest rate environment, and it can easily bring the payment down.

The more down payment you have, the lower your monthly payment can be. So we have people offsetting their new purchases, even though they're paying six and 7% interest and not really having that much of a difference in their payment. And they're [00:03:00] getting a much bigger, better property. So if you're not in love with your house, and, you know, in southern Oregon, we are definitely still in a supply and demand problem. We still have not enough supply. So definitely should think about that if you want a different property.

The third thing you can think about is keeping the property but refinancing out, cashing out a little bit of money and using that down payment either to make improvements to the existing home existing property, or using that as a down payment for an investment.

So that can be another really exciting moment. And again, we don't have enough landlords and in southern Oregon so that is a very honorable profession. It's a great side gig. It's another way to accelerate your wealth building over time. So that is a fun conversation to have. And then let's talk about how to get an equity analysis. This is different than [00:04:00] a CMA. A CMA is a comparable market analysis that compares your property to the other like kind properties and about how much it would sell for.

An equity analysis goes into a slightly different direction. It goes what you paid for it, how much have you paid down and about how much are you going to get out of the property minus any selling or refinancing expenses. So I do those, would love to talk to you about the equity that you have in your property and how you might want to use it. We'd love to give you some figures and facts, and then you can decide what you want to do next.

So that's our podcast for today. I'm Alice Lema, a broker at John L. Scott Real Estate in beautiful Southern Oregon. My number is 541-301-7980. You can text or call me (541) 301-7980. And let's talk about your real estate situation. If you don't have a real estate [00:05:00] situation and you want one, we can talk about that too. Great buyer's agent, great listing agent. We could do ups sizers, downsizers, investors, tenants, elders.

Whatever you want to do, we can make it happen. So give me a call, give me a text. And in the meantime, just enjoy the week, hug those you love. We'll see you next time. Bye now.