Wednesday, November 5, 2025 / by Vic Markarian
Why Your Home Equity Still Puts You Way Ahead (Even If You’ve Heard Prices Are Dropping)
Why Your Home Equity Still Puts You Way Ahead (Even If You’ve Heard Prices Are Dropping)
Have you recently seen headlines warning about home prices dropping and started to wonder, “Is my home losing value?”
If you're planning to sell your home soon, that kind of news can feel unsettling. But here's what most of those headlines miss: even if prices have softened in some markets, your home equity is likely still in great shape—and may actually be higher than ever.
Let’s walk through why.
Home Equity Has Grown Significantly Since 2020
Here’s the reality: home equity tends to move in sync with home prices. When home prices go up, your equity grows. When prices level out, so does equity—but that doesn’t mean it vanishes.
After the intense home price surge of 2020–2021, it was inevitable that things would slow down. But that slowdown has not erased years of equity gains.
Even in cities that have seen recent declines, like Austin, Tampa, or Phoenix, price drops have been modest—usually between 3–6%. But when you compare that to the 40–50% price increases those same areas experienced since March 2020, it’s clear: the long-term gains far outweigh the recent dips.
Home Values Are Up Across All 50 States
Zooming out even further, data from FHFA shows that home values have risen in every single state over the last five years. The national average? A 53.93% increase in home values since 2020.
Even California, often cited for its price sensitivity, has seen a 41.4% gain. In places like Maine and New Jersey, prices have soared over 70%.
So if you’ve owned your home for more than a few years, odds are you’ve built up a level of equity that puts you way ahead of where you started. And that equity can give you flexibility—whether you're downsizing, relocating, or moving up.
Expert Insight: Don’t Let Headlines Shake You
Jake Krimmel, Senior Economist at Realtor.com, puts it in perspective:
“The slight recent declines in aggregate value and total home equity are not cause for concern . . . Although the market is coming into better balance, large price declines nationally are extremely unlikely in the near term.”
Translation: today’s market is not crashing—it’s correcting. And most homeowners remain in a power position.
Bottom Line
Don’t let scary headlines cause unnecessary doubt. Your home equity is likely stronger than ever, even if the market has cooled slightly.
Want to find out exactly how much equity you’ve gained—and what your home is really worth in today’s market?
Let’s connect and build a smart, equity-powered strategy for your next move.
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