We know the equity in a home can be important and is part of net worth. It can be used to purchase with cash when downsizing. It can be sold and the cash used for living expenses - tax-free income up to a point. It can be used as income via a reverse mortgage. It seems a growing number of seniors are using home equity to pay an entrance fee to a CCRC. Or it may be part of inheritance.

But those strategies require the ability to sell. Prices keep rising, but we are also told it is becoming very difficult for younger families to afford today’s prices. In some areas, required down payments are 5% or less just to make a house available to purchase. 

When we sold our family home in 2018, it took longer than anticipated and the price was $70,000 less than needed to cover the cost of our condo. Doing so today may well be more difficult.

The good news is the selling price for our condo today has increased about 60% and they sell quickly in our 55+ plus community. But will that continue?

So, the question becomes, how important is home equity as part of your retirement planning and what creative ways are you (planning to) using it? 

Do you have concerns that changes in the real estate market may upend your plans?

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