In the ever-changing world of real estate, seizing opportunities at the right moment can be the key to maximizing your returns. If you’re a homeowner or real estate investor, the concept of equity is something you’re likely familiar with. But in case you need a refresher, equity is the difference between your property’s current market value and the remaining balance on your mortgage. It’s essentially your ownership stake in your home.
Now, let’s delve into why it might be the perfect time to get your equity out and why an increase in home inventory can influence your decision.
What is equity?
Your equity opportunity
Equity is your financial stake in your property. It represents the portion of your home that you truly own. As you make mortgage payments, you gradually reduce your loan balance, which, in turn, increases your equity. Additionally, the appreciation of your home’s value over time can further boost your equity.
Declining Home Sales
Recent trends in the real estate market indicate a decline in home sales. While this may sound like concerning news, it can work to your advantage, especially if you’re thinking about cashing in on your equity.
What is a buyer’s market?
When home sales drop, the market becomes more favorable for buyers. Sellers, on the other hand, may face a more competitive environment, which can put downward pressure on home prices. In other words, when there are more homes available for sale than there are buyers, it’s often referred to as a “buyer’s market.”
Is Michigan real estate in a buyer’s market or seller’s market?
Michigan is still in a seller’s market, but we’ve already begun our descent into a buyer’s market. This is the absolute perfect time to list your property for sale! Home values have maxed out and are just starting to come down, due to the rise in inventory and interest rates. Here are four reasons why now is the best time to seize your opportunity:
1. Maximize Your Equity
We’re at the peak of home values, and with more homes starting to come on the market and potential buyers looking for deals, you can attract serious buyers eager to make a purchase. This competition can drive up the price buyers are willing to pay, ultimately maximizing the value of your equity.
2. Lock in Favorable Interest Rates
Interest rates play a significant role in the home buying process. When interest rates are low, buyers are more likely to enter the market. By selling your property now and taking advantage of low interest rates, you can potentially secure a more favorable deal on your next home purchase or investment. While rates are not as low as they were two years ago, all economic indicators tell us that they’re lower now than they will be next year or even later this year.
3. Diversify Your Portfolio
If your home is an investment property, cashing in on your equity provides an opportunity to diversify your investment portfolio. You can reinvest your funds in different asset classes, potentially spreading risk and increasing your financial stability.
4. Adapt to Changing Needs
Your lifestyle and housing needs may evolve over time. Selling your current property and tapping into your equity can provide the financial flexibility to explore new opportunities, whether it’s downsizing, upsizing, or exploring other investment avenues.
Get your equity out now, before it shrinks
If you had inside information that one of your stocks was about to decline in value, would you sell it now or would you hang onto it and take the hit? Your house is likely your biggest “stock”! Getting your equity out now, while home sales are declining, can be a strategic move. It allows you to take advantage of the changing market, potentially maximizing your returns and securing your financial future. So, if you’ve been contemplating making a real estate move, now could be the ideal time to unlock the value of your equity that you’ve worked so hard to build over the years.
When it comes to making these important real estate decisions, having an experienced and knowledgeable team on your side is crucial. That’s where Glover Agency comes in. With over two decades of experience in real estate, Glover Agency is widely trusted in the local Michigan real estate industry. When you partner with Glover Agency, you’re tapping into a wealth of expertise and a track record of success that can make your real estate transactions not only smoother but also more profitable.
Want to know how much your home is worth?
As the top real estate team in Michigan, we have a pool of buyers looking for a property like yours! If you want to know how much our buyers are willing to pay for your property, simply fill out this form and we’ll reply with an approximate value of your property and a list of comparable properties in your neighborhood.