Have you ever stopped to think about how much wealth you’ve built up just from being a homeowner? As home values rise, so does your net worth. And, if you’ve been in your house for a few years or longer, there’s a good chance you’re sitting on a pile of equity. Maybe even more than you realize.
What Is Home Equity?
Home equity is the difference between what your house is worth and what you owe on your mortgage. For example, if your house is worth $500,000 and you still owe $200,000 on your home loan, you have $300,000 in equity. It’s essentially the wealth you’ve built through homeownership. Right now, homeowners across the country are seeing record amounts of equity.
According to Intercontinental Exchange (ICE), the average homeowner with a mortgage has $319,000 in home equity.
Why Have Homeowners Gained So Much Equity?
The rise in home equity over the years can be credited to two key factors:
1. Significant Home Price Growth
Home prices have climbed dramatically in recent years. In DuPage County, for example, the average home price grew from $328,223 in 2019 to $503,268 in 2024. This represents an incredible 53.34% increase in just five years. Nationwide, home prices have risen by 57.4%, according to the Federal Housing Finance Agency (FHFA) shown on the map below.
This appreciation means your house is likely worth much more now than when you first bought it.
2. Longer Tenure in Homes
Data from the National Association of Realtors (NAR) on the graph below shows people are staying in their homes longer than ever. On average, homeowners now remain in their homes for a decade. Compare this to the 1985–2008 period, when the average tenure was just six years allowing them more time to pay down mortgage and for their home to appreciate in value. And if you’re one of those people who’s been in their home for 10 years or more, know this, according to NAR:
“Over the past decade, the typical homeowner has accumulated $201,600 in wealth solely from price appreciation.”
The Benefits of Having Home Equity
What does that mean for you? It means your house might be your biggest financial asset. It could open up some exciting opportunities for your future. Let’s break it down.
Moving to Your Next Home
Your equity could help you cover the down payment for your next home. In some cases, it might even mean you can buy your next house all cash.
Financing Home Improvements
Thinking about upgrading your kitchen, adding a sitting room, or tackling other projects? Your equity can provide the funds to make those improvements happen, increasing your home’s value and making it more enjoyable to live in too.
Starting a Business
If you’ve been dreaming about starting your own business, your equity could be the kickstart you need. Whether it’s for startup costs, equipment, or marketing, leveraging your home’s value can help bring your entrepreneurial goals to life.
Bottom Line
If you’re wondering how much equity you’ve built or how you can use it to meet your goals, let’s connect and explore the possibilities. Whether you’re thinking about selling, upgrading, or simply want to understand your financial position and options it may present, your home equity is a powerful resource.
At The Glover Team, we’re here to help homeowners understand their options and make the most of their investments. Let’s chat about how we can help you turn your home equity into an exciting new chapter.
