If you own a home, chances are the value of your property has increased a lot in the past few years. Equity is built up over time as home prices go up and as you make payments towards your mortgage. And considering how home prices soared during the 'unicorn' years, you've probably gained more equity than you realize.

According to the latest Equity Insights Report from CoreLogic, the average homeowner has more than $274,000 in equity right now. That much equity can help you achieve certain goals.

““While the pandemic created serious challenges, the silver lining for anyone who owned a home was the sizable equity gain. Understanding how home equity works, and how to leverage it, is important for any homeowner.””

— Bankrate

I've got a handful of ways you can make the most out of the equity in your home. Consider these options to put your home equity to work for you.

1. Buy a Home That Fits Your Needs

If the place you're in right now isn't cutting it anymore, it might be a good idea to start considering a bigger home. Or, if you've got more space than you need, downsizing to a smaller home could be just what you're looking for. Either way, you can take advantage of the value you've built up in your current home and use it as a down payment on a new one that suits your changing lifestyle. And to help you navigate through this process, a real estate agent can step in and help you figure out how much equity you've got and how to make the most of it when buying your next home.

2. Reinvest in Your Current Home

If you're not quite ready to move, but you want to switch up your space, renovations are a perfect choice. Home improvement projects let you customize your home to suit your style and needs. But don't forget to think about how certain upgrades can boost the value of your home in the long run. To figure out which projects will give you the most bang for your buck when you decide to sell down the line, it's a good idea to talk to a real estate pro. They'll give you expert advice on what improvements to focus on to get the best return on your investment.

3. Pursue Personal Ambitions

Home equity can actually help make your dreams come true! It's like a spark that can ignite your lifelong goals. Maybe you've always wanted to start a new business, retire comfortably, or pursue higher education. Instead of splurging on unnecessary things, you can use your home equity wisely to make a meaningful and lasting impact on your life.

4. Understand Your Options to Avoid Foreclosure

The number of foreclosures being filed is currently lower than usual, so you don't have to worry about a huge influx of foreclosed homes hitting the market. However, there are still homeowners who go through the foreclosure process every year. If you're dealing with financial issues, it's really important to know your options and how your equity can help you out. Your equity can be like a safety net that you can tap into when you face unexpected challenges or situations that make it difficult to pay your mortgage on time. So, it's definitely something to keep in mind!

““If exiting your home is the best option for you, selling with equity may be a good option. When selling with equity, you are using the proceeds from selling your home at a higher price than the amount you owe on your mortgage to pay off your remaining mortgage debt.””

— Freddie Mac

Bottom Line

Did you know that the equity you have in your home can actually be a total game changer? It can help you reinvest in your needs, pursue your goals, and even provide a safety net to avoid foreclosure when times get tough. If you're not quite sure how much equity you have, don't worry! Let's connect and figure it out together, so you can start planning your next move. Sound good?