LBI Real Estate Equity

High Tides Digital Marketing
May 7, 2022
2 min read

Home Equity on Long Beach Island

Long Beach Island Real Estate Equity

LBI real estate equity is the amount of ownership an individual possesses in a home or a property. The amount of equity one has in a piece of real estate is the difference between the value of the home in the Long Beach Island real estate market and the amount of money, if any, owed on a home. A home with no mortgage or debt will have 100% equity.

LBI Real Estate Equity

In a typical year, buyers in the LBI real estate market are roughly split between cash purchases and utilizing a mortgage to buy a home. For those looking to buy a home with a mortgage, the "standard" down payment is 20%, although there are scenarios where less is put down. There are also many scenarios where more is put down, for example, in an investment property that often requires a larger down payment. Obviously, the larger the down payment, the larger the equity position.

There are also ways to attain an equity position outside of making a larger down payment. As the market rises, and so too the value of a home rises, the equity position will increase. This takes time, but the LBI, real estate market, tends to appreciate around 3%-5% each year, so a homeowner should realize that kind of equity growth in theory. Building a new home is the best way to attain an equity position in the LBI real estate market. I handle this kind of transaction quite often, and if managed correctly, there should be a roughly 20%-30% equity position in the finished product. That is a relatively easy and fast way to acquire instant value in a home on Long Beach Island.

Home Equity on Long Beach Island

Buyers and sellers in the LBI real estate market need to understand equity and how it impacts their position in the market. When buyers are looking to purchase a home with a mortgage, they need to ensure they have the proper amount of equity in a home to avoid additional fees and a higher interest rate. If a seller does not have enough equity, they could face a short sale (although infrequent on Long Beach Island). LBI real estate equity is one aspect of the home buying process that needs to be understood to ensure a successful real estate transaction on Long Beach Island. If you have any questions about buying, selling or investing in the LBI real estate market, please do not hesitate to contact me.