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How To Increase Your Home's Equity

by Niz Brown 10/01/2018

Having equity in your home is an incredibly valuable thing. It allows you to borrow against your house and shows that the value of your investment is rising. Equity defined is the difference between your home’s value and the amount you still owe on the home. Equity allows you to move forward with other properties and sell your current one. 


As you pay down your mortgage, your equity increases. There is, however, always a risk of an equity slide where values drop a bit. There are a few ways that you can help your home’s equity value to increase faster.


Pay Towards The Principal


The first few years that you’re a homeowner, you’ll be paying a lot towards the interest and only a little towards the principal value of the loan. The quicker you pay down your home loan, the faster you’ll increase the equity of your home. Check your budget and see how much extra you may be able to pay. Then, talk with your lender to see if there are any pre-payment penalties. 


Complete Home Improvement Projects


You may not know that many home improvement projects can increase the value of your home substantially. There are many projects that you can complete in your home that won’t break the bank yet will give you a significant return. You can start simple, or think big. Some of the best home improvement projects that will add value to your home include:


  • Complete kitchen remodel
  • Replacing countertops
  • Refinishing cabinets
  • Installing new appliances
  • Replacing garage doors
  • Bathroom remodel
  • Putting on addition
  • Landscaping renovations


Any of these home improvement projects can add value to your home, bringing the equity value of the home up. Even if you’re not planning on taking out any equity in your home for some time, any improvement projects that you choose to do are beneficial for both you and how your home affects your finances.  


Increase The Amount Of Your Downpayment


You can increase the value of a home before you even buy it. If you put the traditional 20% down on a house, you’ll build equity a bit faster than if you put down a lower amount such as 3% or 5%. If you have already purchased your home, you can ask your lender to do what’s called a cash-in refinance. This type of refinance is where you bring cash to the refinancing closing table in order to lower the balance of your mortgage.   


About the Author

Author
Niz Brown

Born in San Pedro, California, as a first generation Croatian, I graduated from California State University at Long Beach with a degree in Mathematics and Chemistry and then earned a teaching credential from San Francisco State University. In 1960 I married native San Franciscan Jim Brown. Jim, was a high school teacher before becoming the owner/chef of La Lanterna Restaurant in Kentfield from 1985-1992. He is now retired. I combined substitute teaching in Marin County with the rearing of our four children, all of whom are grown and have settled in Marin. I became intrigued with the world of homes when we acted as the general contractors in building our own home in Woodacre and another home in the San Geronimo Valley. I began to work the carpet business, and became licensed to sell real estate in 1976. I was an associate realtor with other companies before becoming an independent broker and opening my own office in downtown Larkspur in 1991.

Decades of experience in real estate, plus a passion for details, executed in a creative manner allows me to serve in an exceptional manner. I advise my clients on the preparation of a property for sale and use my skills to assist sellers in arranging for staging, clean up, etc. Then I begin the marketing by having the home professionally photographed I create a property website and create fliers and print advertising. The MLS places the listing on all media site. Then when a offer comes in, the negotiation skills and attention to the details of the transaction take over. Other agents often say "you have the nicest listings". I care deeply about the quality of service I provide. When it comes to representing buyers I am patient and tenacious. I am just as excited as the buyer when we find the right home. I love my job!

I network with agents from diverse brokerages. I operate a "bus tour" with 25 professionals from 15 different brokerages. Operating my bus tour is my way of establishing close relationships with colleagues and gives me the opportunity to serve more effectively. Real estate is a unique community of competitors who work together with love and respect and cooperate to serve our clients.

I have developed a passion for photography and painting larger-than-life images of flowers. I am a signature member of the National Watercolor Association. At close of escrow each of my clients is given a choice of one of my prints for their home.