The last few months have been difficult for homeowners, buyers, and sellers alike. And although many experts predicted that the COVID-19 pandemic would cause a housing crash similar to what we saw in 2008, more and more people have actually decided to enter the market this year.
Even if you aren’t thinking about moving soon, you may have questions about how the ongoing economic downturn will affect the real estate market in The Woodlands. Here’s all the information you need to know, especially if you’re concerned about your home’s equity.
How Home Equity Is Helping to Strengthen the Market
One of the biggest questions right now is whether this historic recession will initiate a new surge of foreclosures, especially since many homeowners have found themselves jobless or with less income than before. While foreclosure is a very real fear, things aren’t the same as they were 12 years ago.
Despite the staggering number of unemployment claims, it’s unlikely that the housing bubble will burst anytime soon—and it’s all thanks to rising home equity.
Home equity, explained
In a nutshell, home equity is the difference between your home’s market value and the amount you still have left to pay on your mortgage. This value can change over time, and it tends to increase as you make payments on your home loan.
The more equity you have, the more you stand to make when you go to sell your home. And in today’s market, equity is higher than ever before. In fact, a recent report by John Burns Consulting noted that 58.7% of homes in the U.S. have at least 60% equity, while 42.1% of all homes across the country are mortgage-free.
Equity is at an all-time high
Back in 2008, many homeowners found themselves owing more on their mortgage than what their homes were worth. This negative equity resulted in a staggering number of foreclosures—but today, the housing market is in a much better position.
According to a study by CoreLogic, the average equity mortgaged homes have today is $177,000. That’s a significant amount that homeowners won’t be stepping away from, even as the economy remains in flux.
Having equity prevents foreclosures
Because so many homes are either owned outright or hold significant equity, it’s unlikely that we’ll see a huge spike in foreclosures anytime soon. Believe it or not, now is a fantastic time to list your home and cash out on your hard-earned equity!
Thanks to record low mortgage rates and dwindling inventory, properties in The Woodlands have been flying off the market. And to top it all off, home prices throughout the area are expected to stay high for the foreseeable future.
Bottom Line: Chat with me about your home’s value!
On the fence about listing soon? The sale of your home could unlock tens of thousands in equity—and that valuable profit could be used to take your next step in life. Give me a call for a customized home equity assessment and let me know if you have any questions. I’m always on hand to discuss your real estate goals!
Thinking About Making a Move?
When you’re selling a home in The Woodlands, who you work with matters more than you think. As one of the area’s most awarded agents, I have the experience and dedication to turn your dreams into a reality. Get in touch with me via phone, email, or text to jumpstart your home sale. I can also help you buy your next home, too!