uring the last five years, are borrowing against it and
home prices have increased using the money for home
nationwide. In some parts improvements, dream vacations or
of the country, notably other luxury items. Others are
California, home prices have simply cashing out and moving
doubled or even tripled. The elsewhere. While prices on both
median price of a home in the Los coasts are rising at a
Angeles area is now nearly breathtaking rate, price
$450,000 and in the San Francisco increases in most of the country
area, the price is approaching are still more modest. A
$600,000. As the economy homeowner in California who
continues to improve, the price bought a home five years ago for
of housing continues to rise in $200,000 may have a home worth
California and elsewhere. Many $500,000 today. If that homeowner
people who have owned their homes were to sell that home and move
for more than three years are to Texas, or Iowa or even parts
suddenly finding themselves with of Florida, he or she could buy a
hundreds of thousands of dollars comparable or even larger home,
in equity. Of course, equity is pay cash, and probably keep a
only a theoretical gain, and if healthy profit to invest. For
the price of housing goes down, most Americans, the equity in
equity can go away. You only get their home is their single
to keep your equity as cash if largest asset. Examining that
you sell your home. Many equity to see if it can be used
homeowners are doing just that. more wisely would be a sound
move, particularly as real estate
Home equity loans are experts warn of a housing
increasingly popular these days, "bubble" that may soon reduce
and many people with large prices to more realistic levels.
amounts of equity in their homes Should this "correction" in the
market take place, homeowner On the other hand, the
equity could be seriously opportunity to extract several
reduced. hundred thousand dollars in cash
from a home is a rare one, and
Obviously, selling a home and investing it wisely could go a
moving just to pocket the equity long way towards financing a
is not something that suits better lifestyle or a more
everyone. While it may make sense comfortable retirement.
from a financial standpoint, it Homeowners should be aware that
will mean finding a new employer, there might be capital gains
finding a new home, finding new taxes to be paid on the sale of a
friends and moving children to home. Those considering selling
new schools and friends. Anyone their home to extract their
considering such a move would be equity would probably benefit
well advised to carefully from a consultation with a
consider all of the ramifications financial advisor.
of simply picking up and moving.
About the Author:
"©Copyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including http://www.End-Your-Debt.com, a Website devoted to debt consolidation information and http://www.HomeEquityHelp.net, a site devoted to information on home equity loans.
Source: www.isnare.com
