Whether a repeat or first-time homebuyer, there are many benefits to owning a home, especially financial. In 2021, the national average of equity gained was $56,700 and Alabama’s average was $33,000.
Building long-term wealth over time is why equity matters and due to the past year’s low inventory and high demand, home value increased more than usual. 17.7% to be exact, giving homeowners a significant boost in equity simply by holding on to their houses.
Dr. Frank Nothaft, chief economist at CoreLogic, explains it like this:
“Home price growth is the principal driver of home equity creation. The CoreLogic Home Price Index reported home prices were up 17.7% for the past 12 months ending in September, spurring the record gains in home equity wealth.”
To compare how other states stacked up, check out the Keeping Current Matters map provided by Alabama Realtors.
Keeping Current Matters also reports, “[I]f you’re thinking about becoming a homeowner, understanding the importance of equity can help you realize why homeownership is a worthwhile goal. It builds your wealth and gives you peace of mind that your investment is a wise one, not just from a lifestyle perspective, but from a financial one too.”