If you own a home in Albuquerque you may have wondered about the equity in your home. You may have even been told you HAVE equity. But what does equity mean exactly?
Mark breaks it down for us so you can get one step closer to making the best decisions for you!
NM Homies Real Estate – Helping you buy and sell in ABQ, New Mexico
So equity is described as the value that your home has grown since you purchased it. So if you bought your home for $100,000 in ABQ and your home is now appraised at $150,000, the equity that you’ve accumulated is $50,000. While appraisals vary and the purchase price makes a difference most people will gain equity in their home while they own it. So how do you find out if you have equity in your home, what that is, and what to do with it? Your Homies are here to help! Let’s break it down a little further.
How to get equity:
Now, there is no one thing that you can do to ensure that your home builds equity but updating your home with important renovations like electrical, plumbing, and roofing can improve the value of your home. If your only objective in these renovations is to grow your equity, you have to calculate how much those will cost you vs your projected amount of equity growth. In some cases, they do not have enough ROI to be done for that reason only.
How to find if you have equity:
An equity review of your home by a local real estate professional will give you a great idea of what your home is worth. We run comps from your neighborhood, the current market, any updates you’ve made, and based on this review you will be able to get a good idea of the value of your home. From here you will be able to make a decision on selling and if you do decide to do that an appraisal will show a more official number of your home value. Home values in ABQ are constantly growing and it’s likely that your home value has grown.
What to do with your equity:
There are a few options for homeowners who have built equity in their homes. Selling to get the most bang for your buck is always an option. We go through the equity review process and the listing process together when you decide to sell. We talk about where the market is at and what your home can realistically sell for in it. Then our full-service team gets to work to get you the price we set!
The other option for a homeowner that has built equity is to refinance. This option is good if you have a considerable amount of equity. There are a few reasons one can refinance; to get cash out of their house and to lower their interest rate. If you are pulling out cash from your home your monthly mortgage payment will go up. If you are refinancing only for a lower interest rate your monthly mortgage payment will go down. Some people are able to do both if the interest rates allow.
The first step:
The first step to figuring out if you have equity is to call NM Homies and set up an appointment. We will come to evaluate your home, run some numbers and give you an idea of what your home is worth now! Then if you are interested in selling, we would go through all the possible options for your listing. If you are shy about having people in your home we can work around that through some phone calls.
There is more as well! Give us a call and let’s get you some info about the equity in your home!