The beginning of the year is the perfect time to take stock of your assets and your overall financial health. One large piece of that puzzle? The value of your home! A Comparative Market Analysis (CMA) gives you an idea of the current value of your home based on data from similar homes in your market.
Your CMA can help you make large life changes and financial decisions, and will shed light on broader trends so you can act as an empowered player in today’s real estate market. Please reach out to us any time to request a CMA for your current home.
Making Decisions Based On Your CMA
With so many ways to leverage your home as an asset, it’s critical to fully understand the value of that asset. As you review your CMA, you can consider the following questions in much more concrete terms:
How much cash would be available if you decided to sell and buy a different house?
If you’ve been waiting for the right time and circumstance for selling your home, your CMA can shed light on exactly how much you could expect to make on the sale of your home. From there, you can browse homes in your desired area to see exactly what your new budget can buy you in terms of a new home.
How much cash would be available to rent your home and buy another?
There are ways to use your home equity without selling it! If you’re one of the many people who purchased a home in 2020 or 2021 with a very low interest rate, you may feel that you’re “stuck” with your current home because of your wonderful rate. Your CMA can help you understand whether you’ve got a viable path to renting out your current home and withdrawing some of its equity to purchase your next home, perhaps one in your desired neighborhood or one better suited to your current lifestyle.
How much cash would be available to invest in another investment property?
Maybe you don’t want to move from your current home, but you’re interested in pursuing investment properties as another avenue of building wealth. Your CMA can give you details about how much cash you could invest in additional investment properties.
How much cash would be available to spend, save, invest, or pay off other debts?
In Colorado, homes have appreciated quickly! Many homeowners are sitting on a sizable asset while struggling with credit card debt, student loans, car payments, medical debt, and other payments. A thorough understanding of the available equity in your home can help you determine the pros and cons of taking some of that equity out in order to pay off other debts. Or, if you’re planning for large upcoming expenses or investments, you might decide that withdrawing cash from your home equity is the best method of payment.
Your Next Steps
First, reevaluate your homeowner insurance needs. Talk with your trusted insurance representative about your home’s CMA to make sure your current coverage will take care of you in any circumstance.
From there, sit down and evaluate your short and long-term goals and where your assets and lifestyle fall in relation to those. Your CMA can help you determine the best next steps whether you’re ready for a move, looking to pay off debt, ready for a new business venture, ready to retire, and a range of other possibilities. Talk with your accountant and financial advisor about your goals and the findings in your CMA to strategically plan your next steps.
As always, we’re here to equip you with the knowledge to make the best possible decisions about your real estate goals. Give us a call if you’d like a CMA for your home, if you have further questions, or when you’re ready to discuss your next steps!
