Increasing Your Wealth Through Home Ownership

Dated: March 22 2019

Views: 109

Want To Increase Your Family’s Wealth? Here’s How!



Everyone should realize that unless you are living somewhere rent-free, you are paying a mortgage – either yours or your landlord’s. Buying your own home provides you with a form of ‘forced savings’ that allows you to use your monthly housing costs to increase your family’s wealth.

Every month that you pay your mortgage, you are paying off a portion of the debt that you took on to purchase your home. Therefore, you own a little bit more of your home every month in the form of home equityAs your home’s value increases, you also gain home equity.

Every quarter, Pulsenomics surveys a nationwide panel of over 100 economists, real estate experts, and investment and market strategists. They are asked to project how residential home prices will appreciate over the next five years for their Home Price Expectation Survey (HPES).

The latest data from their Q1 2019 Survey revealed that home prices are expected to round out the year 4.3% higher than they were in January. For the next 5 years, home values will appreciate by an average of 3.21% a year.

This is great news for homeowners!

For example, let’s assume a young couple purchased and closed on a $250,000 home in January of this year. Simply through their home appreciating in value, those homeowners can build their home equity by over $40,000 over the next five years.

Want To Increase Your Family’s Wealth? Here’s How! | MyKCM

Let’s look at the potential equity gained over the same period of time at some higher price points:

Want To Increase Your Family’s Wealth? Here’s How! | MyKCM

In many cases, home equity is a large portion of a family’s overall net worth.

Bottom Line

Whether it’s your first or your fifth, if your plan for this year includes buying a home, let’s get together to help you understand where prices are headed in our area.

Blog author image

William Flowers

I have grown up in the Memphis area for the majority of my life and grew up going to Germantown Baptist Church as a kid. My relationship with Christ has given me a deep desire to help my community and....

Latest Blog Posts

Best First Time Buyer Neighborhoods Part 2: 38117

Want to purchase your first home in East Memphis but don't know where to look? 38117 is one of the best zip codes in all of Memphis with ample opportunity for first time buyers, move up buyers, and

Read More

Best First Time Buyer Neighborhoods Part 1: 38119

There are so many great neighborhoods for first time buyers in the Memphis area and 38119 is one of the most affordable zip codes in all of Memphis. Since January 1st of 2019, 543 homes priced

Read More

Is Moving The Boost You Need?

Why Moving May Be Just the Boost You NeedAs we look back over the past year, we’ve certainly lived through one of the most stressful periods in recent history. After spending so much more time

Read More

The Difference Between An Appraisal and Inspection

What’s the Difference between an Appraisal and a Home Inspection?If you’re planning to buy a home, an appraisal is an important step in the process. It’s a

Read More