If you’ve seen the scary headlines about prices “dropping,” take a breath. Even with small dips in a few spots, most homeowners (very likely you) are still way ahead—thanks to the equity you’ve built.
Prices and Equity: They Move Together
Equity rides along with home prices. When prices rise, your equity grows. When prices cool a bit, equity growth eases too. That’s exactly what we’re seeing.
After the record-setting jump in 2020–2021 (remember bidding wars and zero inventory?), a cooldown was inevitable. More homes hit the market this year, growth eased, and equity gains slowed—not vanished.
Zooming Out for Perspective
Here’s the bigger picture: you probably have far more equity than you did a few years ago. That puts you in a strong position if you’re thinking about selling, downsizing, or moving up.
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Since March 2020, national home prices are up roughly 45%.
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In most markets, prices are still rising—just at a calmer pace.
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Even in the few metros making headlines for declines, the average dip is around -4%.
Translation: years of gains easily outweigh today’s modest softening.
And when we look statewide, the story holds. FHFA data shows every single state has seen price growth over the last five years—meaning homeowners across the board have substantially more equity than they did five years ago (see graph below).
Why This Matters for You
If you’ve owned your home for more than a couple of years, odds are you’re sitting on meaningful equity—equity you can use to right-size, relocate, or simply breathe easier about your financial picture.
Worried about a crash? Here’s how Jake Krimmel, Senior Economist at Realtor.com, puts it:
“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 . . .”
In short: moderation isn’t a meltdown—it’s balance after an unsustainable sprint.
Bottom Line
Even with some price softening in select areas, today’s homeowners are still sitting on near-record equity. Curious how far ahead you really are? Let’s run your personalized equity + market update and map out smart next steps for 2025.
