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      What Does 2021 Have in Store for Home Values?

      What Does 2021 Have in Store for Home Values? | MyKCM

      According to the latest CoreLogic Home Price Insights Report, nationwide home values increased by 8.2% over the last twelve months. The dramatic rise was brought about as the inventory of homes for sale reached historic lows at the same time buyer demand was buoyed by record-low mortgage rates. As CoreLogic explained:

      “Home price growth remained consistently elevated throughout 2020. Home sales for the year are expected to register above 2019 levels. Meanwhile, the availability of for-sale homes has dwindled as demand increased and coronavirus (COVID-19) outbreaks continued across the country, which delayed some sellers from putting their homes on the market.

      While the pandemic left many in positions of financial insecurity, those who maintained employment and income stability are also incentivized to buy given the record-low mortgage rates available; this is increasing buyer demand while for-sale inventory is in short supply.”

      Where will home values go in 2021?

      Home price appreciation in 2021 will continue to be determined by this imbalance of supply and demand. If supply remains low and demand is high, prices will continue to increase.

      Housing Supply

      According to the National Association of Realtors (NAR), the current number of single-family homes for sale is 1,080,000. At the same time last year, that number stood at 1,450,000. We are entering 2021 with approximately 370,000 fewer homes for sale than there were one year ago.

      However, there is some speculation that the inventory crush will ease somewhat as we move through the new year for two reasons:

      1. As the health crisis eases, more homeowners will be comfortable putting their houses on the market.

      2. Some households impacted financially by the pandemic will be forced to sell.

      Housing Demand

      Low mortgage rates have driven buyer demand over the last twelve months. According to Freddie Mac, rates stood at 3.72% at the beginning of 2020. Today, we’re starting 2021 with rates one full percentage point lower than that. Low rates create a great opportunity for homebuyers, which is one reason why demand is expected to remain high throughout the new year.

      Taking into consideration these projections on housing supply and demand, real estate analysts forecast homes will continue to appreciate in 2021, but that appreciation may be at a steadier pace than last year. Here are their forecasts:What Does 2021 Have in Store for Home Values? | MyKCM

      Bottom Line

      There’s still a very limited number of homes for sale for the great number of purchasers looking to buy them. As a result, the concept of “supply and demand” mandates that home values in the country will continue to appreciate.

      Why To Not Wait Until Spring to Make a Move

      Why Not to Wait Until Spring to Make a Move | MyKCM

      The housing market recovery coming into the new year has been nothing short of remarkable. Many experts agree the turnaround from the nation’s economic pause is playing out extremely well for real estate, and the current market conditions are truly making this winter an ideal time to make a move. Here’s a dive into some of the biggest wins for homebuyers this season.

      1. Mortgage Rates Are Historically Low

      In 2020, mortgage rates hit all-time lows 16 times. Continued low rates have set buyers up for significant long-term gains. In fact, realtor.com notes:

      “Given this means homes could cost potentially tens of thousands less over the lifetime of the loan.”

      Essentially, it’s less expensive to borrow money for a home loan today than it has been in years past. Although mortgage rates are expected to remain relatively low in 2021, even the slightest increase can make a big difference in your payments over the lifetime of a home loan. So, this is a huge opportunity to capitalize on right now before mortgage rates start to rise.

      2. Equity Is Growing

      According to John Burns Consulting58.7% of homes in the U.S. have at least 60% equity, and 42.1% of all homes in this country are mortgage-free, meaning they’re owned free and clear.

      In addition, CoreLogic notes the average equity homeowners gained since last year is $17,000. That’s a tremendous amount of forced savings for homeowners, and an opportunity to use this increasing equity to make a move into a home that fits your changing needs this season.

      3. Home Prices Are Appreciating

      According to leading experts, home prices are forecasted to continue appreciating. Today, many experts are projecting more moderate home price growth than last year, but still moving in an upward direction through 2021.

      Knowing home values are increasing while mortgage rates are so low should help you feel confident that buying a home before prices rise even higher is a strong long-term investment.

      4. There Are Not Enough Homes for Sale

      With today’s low inventory of homes on the market, which is contributing to this home price appreciation, sellers are in the driver’s seat. The competition is high among buyers, so homes are selling quickly.

      Making a move while so many buyers are looking for homes to purchase may mean your house rises to the top of the buyer pool. Selling your house before more listings come to the market in the traditionally busy spring market might be your best chance to shine.

      Bottom Line

      If you’re considering making a move, this may be your moment, especially with today’s low mortgage rates and limited inventory. Let’s connect to get you set up for homebuying success in the new year.

       

      Are Home Prices Headed Toward Bubble Territory?

       Are Home Prices Headed Toward Bubble Territory? | MyKCM

      Talk of a housing bubble is beginning to crop up as home prices have appreciated at a rapid pace this year. This is understandable since the appreciation of residential real estate is well above historic annual averages. According to the Federal Housing Finance Agency (FHFA), annual appreciation since 1991 has averaged 3.8%. Here are the latest 2020 appreciation numbers from three reliable sources:

      It’s easy to jump to the conclusion that house appreciation is out of control in today’s market. However, we need to put these numbers into context first.

      Inflation and the Comeback from the Housing Crash

      Following the housing crash, home values depreciated dramatically from 2007-2011. Values are still recovering from that unusually long period of falling prices. We must also realize that normal inflation has had an impact.

      Bill McBride, the founder of the well-respected Calculated Risk blog, recently summed it up this way:

      “It has been over fourteen years since the bubble peak. In the Case-Shiller release today, the seasonally adjusted National Index, was reported as being 22.2% above the previous bubble peak. However, in real terms (adjusted for inflation), the National index is still about 2% below the bubble peak…As an example, if a house price was $200,000 in January 2000, the price would be close to $291,000 today adjusted for inflation.”

      The COVID Impact on Home Prices

      The pandemic caused many households to reconsider whether their current home still fulfills their lifestyle. Many homeowners now want larger yards that are both separate and private.

      Their needs on the inside of the home have changed too. People now want home offices, gyms, and living rooms well-suited for video conferencing. Barbara Ballinger, a freelance writer and the author of several books on real estate, recently wrote:

      “While homeowners continue to want their outdoor spaces that offer a safe retreat, that appeal has shifted into other parts of the home, coupling comfort with function. In other words, homeowners want amenities for work and leisure, and they plan to enjoy them long after the pandemic.”

      At the same time, concerns about the pandemic have caused many homeowners to put their plans to sell on hold. Realtor.com just released their November Monthly Housing Market Trends Report. It explains:

      “Nationally, the inventory of homes for sale decreased 39.2% over the past year in November…This amounted to 490,000 fewer homes for sale compared to November of last year.”

      More people buying and fewer people selling has caused home prices to escalate. However, with a vaccine on the horizon, more homeowners will be putting their houses on the market. This will better balance supply with demand and slow down the rapid appreciation.

      That’s why major organizations in the housing industry are calling for much more moderate home appreciation next year. Here are the most recent forecasts for 2021:

      This Is Nothing Like 2006

      Finally, let’s put to rest some of the concerns that today’s scenario is anything like what led up to the last housing crash. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), explains why this is nothing like 2006:

      “Such a frenzy of activity, reminiscent of 2006, raises questions about a bubble and the potential for a painful crash. The answer: There’s no comparison. Back in 2006, dubious adjustable-rate mortgages taxed many buyers’ budgets. Some loans didn’t even require income documentation. Today, buyers are taking out 30-year fixed-rate mortgages. Fourteen years ago, there were 3.8 million homes listed for sale, and home builders were putting up about 2 million new units. Now, inventory is only about 1.5 million homes, and home builders are underproducing relative to historical averages.”

      Bottom Line

      Most aspects of life have been anything but normal in 2020. That includes buying and selling real estate. High demand coupled with restricted supply has caused home prices to appreciate above historic levels. With the end of the health crisis in sight, we will see price appreciation return to more normal levels next year.

      Compass Contemplations For Monday

      DID YOU KNOW? Weekly Gallup polls in the U.S. found 91% of respondents said they had worn a mask in the past 7 days in September, compared with 80% in May. In France, which is experiencing a MASSIVE Covid surge, 72% of people said they were avoiding gatherings and face-to-face meetings as of mid-May, right after the country’s lockdown ended. But by Sept. 23rd, that figure had fallen to 32%. In the same time frame, the percentage who said they greeted others without shaking hands or embracing fell from 88% to 69%. Covid-discipline-fatigue is real and is causing massive new case spikes and deaths in the US and Europe. This is a marathon, not a sprint:  please remain disciplined about keeping distance, wear masks, keep rooms well ventilated and wash hands. (WSJ)

       

      DID YOU KNOW? According to a survey commissioned by optical retailer Vision Direct, people’s average daily screen time has ballooned to more than 19 hours a day when accounting for viewing multiple devices at once (you know who you are). If this pace continues, a newborn with an average life expectancy will spend nearly 58 years bathed in the glow of laptops, smartphones, televisions and whatever screens 2048 brings. Want to know where the consumers' eyes are: now you know..... (WSJ)

      DID YOU KNOW? Zoom use jumped from 10 million a day in December 2019 to more than 300 million a day by late March. (WSJ)

      DID YOU KNOW? American households watched 4 billion more hours of television in 2020 versus 2019.

      DID YOU KNOW?  Disruption is not a new thing at all..... This past weekend in 1861 Western Union completed the first transcontinental telegraph line across the US, making nearly instantaneous cross-country communication possible for the first time. Previously, it took 10 days for a letter to be sent from Missouri to California via the Pony Express.....two days later the Pony Express shut down operations.

      Is it Time to Move into a Single-Story Home?

       

      Is it Time to Move into a Single-Story Home? | MyKCM

      Once the kids have left the nest, you may be wondering what to do with all of the extra space in your home. Chances are, you don’t need four bedrooms anymore, and it may be a great time to sell your house and downsize, maybe even into a single-story home. You’ve likely gained significant equity if you’ve lived in your home for a while, so making a move while demand for your current house is high could be your best step forward toward the retirement goals you set out to achieve several years ago.

      The dilemma, though, is where to go next. A big concern for many homeowners who are ready to sell is finding a home to move into, given today’s lack of houses available for sale. There is, however, some good news: the number of single-family 1-story homes being built today is on the rise, improving your odds of finding the right home for your changing needs. In a recent article, The National Association of Home Builders (NAHB) explains:

      “Nationwide, the share of new homes with two or more stories fell from 53% in 2018 to 52% in 2019, while the share of new homes with one story grew from 47% to 48%.”

      Here’s a map showing the breakdown of newly constructed homes being built by region, and the percentage of 1-story and 2-story homes in that mix:Is it Time to Move into a Single-Story Home? | MyKCM

      What are the benefits of buying a one-story home?

      Still not sure about buying a single-story home? An article from Home Talk covers several advantages of switching from two floors to one:

      1. Energy Efficient

      “It is easier to heat and cool a single-story house [than] it would be to regulate the temperatures of a multi-story house.”

      Most single-story homes only need one heating or cooling unit, and they typically stay cooler than a two-story home, both of which can lead to significant savings.

      2. Easier to Maintain

      “Doing a general cleaning in a single story requires less effort and you will be able to see all areas that need cleaning and the areas are easily accessible.”

      Cleaning and maintenance of a single-story home can take less time and effort, and better upkeep helps improve the overall value of the home.

      3. Accessible for Everyone

      “A single-story house can be accessed by anyone, whether they are young children or the senior citizens.”

      If you’re looking for a house that provides a safe and easily accessible environment at any age, a single-story home may be optimal.

      4. Good Resell Potential

      “When buying a single-story house, you should consider the resale value should you think of reselling it in case of a circumstance that can happen. Look at the growth rate of that area. Due to the high demand of these types of houses it is [easy] to resell them and depending on the growth rate of an area, it increases in value significantly.”

      Single-story homes have a lot of benefits and are often in higher demand. This bodes well for future resale opportunities.

      Bottom Line

      There are many benefits to downsizing into a one-story home. Doing so while demand for your current house is high might make it easier than ever to make a move. Let’s connect if you’re ready to purchase the single-story home you need while homes are so affordable today.

       

       

      Buying a Home During a Pandemic

      Buying a home is likely one of the largest investments many of us will make in our lifetime. After
      years of saving, planning, and budgeting, you may feel prepared and even excited to begin your
      first home-buying process. However, with the outbreak of COVID-19 and the overwhelming
      effect that it has had on economies across the world, the real estate market has been inevitably
      impacted as well. That said, you may be wondering how this will affect your home purchase.
      Unexpectedly, while several industries have been declining from the pandemic, the real estate
      industry has managed to stay afloat and in some cases, grow during the pandemic. So the
      question is; as a buyer, what benefits will you gain from purchasing your home now?

       

      Less Competition


      As you may have already found out, house hunting in large cities and popular suburban areas is
      not always a walk in the park because of the intense competition that many homebuyers face.
      Finding your ‘perfect’ home may have been more of a dream than reality after comparing prices
      and battling offers with other prospective buyers. However, the outbreak of COVID-19 has
      actually driven less competition within the market in certain areas.

       

      Consumer Reports recommends thinking outside of the box when it comes to your house search
      locations. In some cases, you are able to find the gem that matches your needs in a location
      where you weren’t expecting to look initially. These areas often drive less competition because
      so many homebuyers are naturally feeling uncertainty from the pandemic, so they are less likely
      to take a risk when buying a home and expand outside of their range of comfort.

      In a general sense, social distancing mandates and limited travel have caused many to
      postpone their house hunt, making it one of the best times to jump in.

       

      Virtual and Online Capabilities


      Many prospective buyers have even postponed their house search because of the assumption
      that they will not be able to tour houses or do walk-through inspections. As we know, this limited
      in-person contact is to ensure the safety of everyone. However, it shouldn’t be a reason to stop
      the search. There are many technology-based options that work to make the buying process as
      comfortable as possible even during a pandemic.

       

      The housing market overall had already begun its transition to technology-based services in
      recent years and tech has become a necessity for the survival of the market this year. Home
      buying transactions like mortgage preapprovals, loan financing, and closing on a home can all
      be conducted through digital lenders and virtual services. Even if you already own a home,
      refinancing with no-closing-cost can be achieved more efficiently through digital lenders.

      Especially with the industry being forced into virtual services, digital lenders are more likely to
      introduce automation into their processes to provide more efficiency. Automation systems like
      robotic process automation (RPA) help to make significant operational improvements in lending
      which in return, produces fast, quality processing for you as a buyer.
      Lower Interest Rates & Housing Prices

       

      One of the most attractive parts of the real estate market currently is the low-interest rates on
      mortgages. In the early part of this year, interest rates actually dropped below 3% for the first
      time in 50 years. While these rates are expected to fluctuate in the coming months, it can still be
      a good idea to take advantage of them while they are here.

       

      However, while the interest rates are decreasing, housing prices are still rising. Instinctively,
      most of us see this as a deterrent from buying a home. However, before making that
      assumption it’s recommended to conduct more research on the trends of the market. Why? With
      less competition, some might argue that the market prices will increase in the coming months as
      quarantine mandates are lifted and a vaccine is publicly distributed. Prospective buyers who
      postponed their house hunt will rejoin the market, causing a greater demand and inevitably
      higher market prices. So before completely shying away from purchasing your home during the
      pandemic, be sure to keep an eye on the market and how prices are changing over time to be
      sure you are making effective financial decisions.

       

      Navigating such a challenging yet rewarding stage of life through a pandemic can take an
      immense amount of strategy and patience. Be sure to keep in mind these benefits of continuing
      your search through the pandemic and take advantage of them where you can. By investing
      time and research into these tips, you can leverage the best components of your local housing
      market during such an uncertain time.

      The Top Reasons People Are Moving This Year

       

       

      The Top Reasons People Are Moving This Year | MyKCM

      Today, Americans are moving for a variety of different reasons. The current health crisis has truly re-shaped our lifestyles and our needs. Spending extra time where we currently live is enabling many families to re-evaluate what homeownership means and what they find most important in a home.

      According to Zillow:

      “In 2020, homes went from the place people returned to after work, school, hitting the gym or vacationing, to the place where families do all of the above. For those who now spend the majority of their hours at home, there’s a growing wish list of what they’d change about their homes, if possible.” 

      With a new perspective on homeownership, here are some of the top reasons people are reconsidering where they live and making moves this year.

      1. Working from Home

      Remote work is becoming the new norm in 2020, and it’s continuing on longer than most initially expected. Many in the workforce today are discovering they don’t need to live close to the office anymore, and they can get more for their money if they move a little further outside the city limits. Lawrence Yun, Chief Economist for the National Association of Realtors (NAR) notes:

      “With the sizable shift in remote work, current homeowners are looking for larger homes and this will lead to a secondary level of demand even into 2021.”

      If you’ve tried to convert your guest room or your dining room into a home office with minimal success, it may be time to find a larger home. The reality is, your current house may not be optimally designed for this kind of space, making remote work and continued productivity very challenging.

      2. Virtual Schooling

      With school about to restart this fall, many districts are beginning the new academic year online. Education Week is tracking the reopening plans of schools across the country, and as of August 21, 21 of the 25 largest school districts are choosing remote learning as their back-to-school instructional model, affecting over 4.5 million students.

      With a need for a dedicated learning space, it may be time to find a larger home to provide your children with the same kind of quiet room to focus on their schoolwork, just like you likely need for your office work.

      3. A Home Gym

      Staying healthy and active is a top priority for many Americans. With various levels of concern around the safety of returning to health clubs across the country, dreams of space for a home gym are growing stronger. The Home Builders Association of Greater New Orleans explains:

      “For many in quarantine, a significant decrease in activity is more than a vanity issue – it’s a mental health issue.”

      Having room to maintain a healthy lifestyle at home – mentally and physically – may prompt you to consider a new place to live that includes space for at-home workouts.

      4. Outdoor Space

      Especially for those living in an apartment or a small townhouse, this is a new priority for many as well. Zillow also notes the benefits of being able to use yard space throughout the year:

      “People want more space in their next home, and one way to get it is by turning part of the backyard into a functional room, ‘an outdoor space for play as well as entertaining or cooking.’”

      You may, however, not have the extra square footage today to have these designated areas – indoor or out.

      Moving May Be Your Best Option

      If you’re clamoring for extra space to accommodate your family’s changing needs, making a move may be your best bet, especially while you can take advantage of today’s low mortgage rates. Low rates are making homes more affordable than they have been in years. According to Black Knight:

      “Buying power for those shopping for a home is up 10% year over year, with home buyers able to afford nearly $32,000 more home than they could have 1 year ago while keeping their monthly payment the same.”

      It’s a great time to get more home for your money, just when you need the extra space.

      Bottom Line

      People are moving for a variety of different reasons today, and many families’ needs have changed throughout the year. If you’ve been trying to decide if now is the time to buy a new home, let’s connect to discuss your needs.


       

      Want to Make a Move? Homeowner Equity is Growing Year-Over-Year

      Want to Make a Move? Homeowner Equity is Growing Year-Over-Year | MyKCM

      One of the bright spots of the 2020 real estate market is the growth in equity homeowners are experiencing across the country. According to the recently released Homeowner Equity Insights Report from CoreLogic, in nearly every state there was a year-over-year first-quarter equity increase, averaging out to a 6.5% overall gain.

      The report notes:

      “CoreLogic analysis shows U.S. homeowners with mortgages (roughly 63% of all properties) have seen their equity increase by a total of nearly $590 billion since the first quarter of 2019, an increase of 6.5%, year over year.” (See map below):

      Want to Make a Move? Homeowner Equity is Growing Year-Over-Year | MyKCM

      This means that In the first quarter of 2020, the average homeowner gained approximately $9,600 in equity during the past year.”

      That’s a huge win for homeowners, especially for those looking to sell their houses and make a move this summer. Having equity to re-invest in your next home is a major force that can make moving a reality, especially while buyers are expressing such a high demand for homes to purchase.

      Below, Frank Martell, President, and CEO of CoreLogic addresses the potential long-term outlook, and how homeowners will likely fare much more positively through the current recession than many did during the last one:

      “Many homeowners will experience a recession during their lifetime, and it is reasonable to compare the current recession to those in the past. But the comparison is not apples to apples — every recession is different. Primary drivers of the Great Recession were an overbuilt housing stock, risky mortgages and the collapse of home prices, creating a massive increase in negative equity that proved difficult to recover from. Today’s housing environment has low vacancy and delinquency rates and a large home equity cushion.”

      Bottom Line

      Now is a great time to consider leveraging your equity and making a move, especially while buyer interest is high. Let’s connect to explore your equity position and make your next move a reality.

       

      6 Reasons Why Selling Your House on Your Own Is a Mistake

      6 Reasons Why Selling Your House on Your Own Is a Mistake | MyKCM

      There are many benefits to working with a real estate professional when selling your house. During challenging times like the one we face today, it becomes even more important to have an expert help guide you through the process. If you’re considering selling on your own, known in the industry as a For Sale By Owner or FSBO, please consider the following:

      1. Your Safety Is a Priority

      During this pandemic, your family’s safety comes first. When you FSBO, it is incredibly difficult to control entry into your home. A real estate professional will have the proper protocols in place to protect not only your belongings, but your family’s health and well-being too. From regulating the number of people in your home at one time to ensuring proper sanitization during and after a showing, and even facilitating virtual tours for buyers, agents are equipped to follow the latest industry standards recommended by the National Association of Realtors (NAR) to help protect you and your family.

      2. A Powerful Online Strategy Is a Must to Attract a Buyer

      Recent studies have shown that, even before COVID-19, the first step 44% of all buyers took when looking for a home was to search online. Throughout the process, that number jumped to 93%. Today, those numbers have grown exponentially. Most real estate agents have developed a strong Internet and social media strategy to promote the sale of your house. Have you?

      3. There Are Too Many Negotiations

      Here are just a few of the people you’ll need to negotiate with if you decide to FSBO:

      • The buyer, who wants the best deal possible
      • The buyer’s agent, who solely represents the best interest of the buyer
      • The inspection companies, which work for the buyer and will almost always find challenges with the house
      • The appraiser, if there is a question of value

      As part of their training, agents are taught how to negotiate every aspect of the real estate transaction and how to mediate the emotions felt by buyers looking to make what is probably the largest purchase of their lives.

      4. You Won’t Know if Your Purchaser Is Qualified for a Mortgage

      Having a buyer who wants to purchase your house is the first step. Making sure they can afford to buy it is just as important. As a FSBO, it’s almost impossible to be involved in the mortgage process of your buyer. A real estate professional is trained to ask the appropriate questions and, in most cases, will be intimately aware of the progress that’s being made toward a purchaser’s mortgage commitment. Further complicating the situation is how the current mortgage market is rapidly evolving because of the number of families out of work and in mortgage forbearance. A loan program that was there yesterday could be gone tomorrow. You need someone who is working with lenders every day to guarantee your buyer makes it to the closing table.

      5. FSBOing Has Become More Difficult from a Legal Standpoint

      The documentation involved in the selling process has increased dramatically as more and more disclosures and regulations have become mandatory. In an increasingly litigious society, the agent acts as a third-party to help the seller avoid legal jeopardy. This is one of the major reasons why the percentage of people FSBOing has dropped from 19% to 8% over the last 20+ years.

      6. You Net More Money When Using an Agent

      Many homeowners believe they’ll save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission. A study by Collateral Analytics revealed that FSBOs don’t actually save anything by forgoing the help of an agent. In some cases, the seller may even net less money from the sale. The study found the difference in price between a FSBO and an agent-listed home was an average of 6%. One of the main reasons for the price difference is effective exposure:

      “Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.”

      The more buyers that view a home, the greater the chance a bidding war will take place.

      Bottom Line

      Listing on your own leaves you to manage the entire transaction yourself. Why do that when you can hire an agent and still net the same amount of money? Before you decide to take on the challenge of selling your house alone, let’s connect to discuss your options.

      #1 Financial Benefit of Homeownership: Family Wealth

       

      #1 Financial Benefit of Homeownership: Family Wealth | MyKCM

      While growing up, we were taught by our parents and grandparents that owning a home is a financially savvy move. They explained how a mortgage is like a “forced savings plan.” When you pay rent, that money is lost forever. When you make a mortgage payment, much of that money accumulates as equity in the home. So, what exactly is equity? The equity in your home is the amount of money you can sell it for minus what you still owe on the mortgage. Every month you make a mortgage payment, and every month a portion of what you pay reduces the amount you owe. That reduction of your mortgage every month increases your equity. A recent study by CoreLogic explained that homeowners gained substantial equity over the last twelve months, and are essentially sitting on large sums of cash in their homes. In the study, Frank Nothaft, Chief Economist for CoreLogic explained:
      “The CoreLogic Home Price Index recorded a quickening of home price gains during the fourth quarter of 2019, helping to boost home equity wealth. The average family with a mortgage had a $7,300 gain in home equity during the past year, and a total of $177,000 in home equity wealth.”
      For most families, their home is their largest financial asset. This increase in equity drives the net worth, or family wealth, of the homeowner. Renters are not earning that benefit. Instead, they’re building the net worth of their landlord.

      Bottom Line

      Home price growth will moderate during the pandemic. But once a cure is available, most experts agree that home values will again begin to appreciate at levels similar to what we’ve seen over the last several years. In the long run, our family elders will be proven correct: owning a home is a savvy financial move.
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