The last 18 months changed what many buyers are looking for in a home. Recently, the American Institute of Architects released their AIA Home Design Trends Survey results for Q3 2021. The survey reveals the following:
· 70% of respondents want more outdoor living space
· 69% of respondents want a home office (48% wanted multiple offices)
· 46% of respondents want a multi-function room/flexible space
· 42% of respondents want an au pair/in-law suite
· 39% of respondents want an exercise room/yoga space
If you’re a homeowner who wants to add any of the above, you have two options: renovate your current house or buy a home that already has the spaces you desire. The decision you make could be determined by factors like:
1. A possible desire to relocate
2. The difference in the cost of a renovation versus a purchase
3. Finding an existing home or designing a new home that has exactly what you want (versus trying to restructure the layout of your current house)
In either case, you’ll need access to capital: the funds for the renovation or the down payment your next home would require. The great news is that the money you need probably already exists in your current home in the form of equity.
Home Equity Is Skyrocketing
The record-setting increases in home prices over the last two years dramatically improved homeowners’ equity. The graph below uses data from CoreLogic to show the average home equity gain in the first quarter of the last nine years:
