Monday Market Update: Home Equity – To Use or Not To Use?

Did you know that homeowners have a collective $11 trillion dollars available to borrow – and a record number of residents are choosing to use it! According to the Intercontinental Exchange Mortgage Monitor, “Homeowners tapped an estimated $47 billion in equity during the first three months of 2026.” This is the highest Q1 withdrawal number in the last 5 years and accounts for nearly $25 million dollars.

While utilizing your home equity isn’t new, the current economic climate and lock-in effect make it more appealing to many individuals. The last surge of home equity draws in 2021 was linked to home price appreciation, according to Realtor.com® Sr. Economist Jake Krimmel. Krimmel states that “In 2021, people were probably tapping into their home equity because they suddenly felt they had so much of it. House prices were appreciating quickly, mortgage rates were extremely low, people were refinancing into lower monthly payments while seeing their home equity rise. So, there was real wealth and consumer purchasing power to chase.”

Today’s home equity resurgence has some different circumstances; Krimmel explains that in 2026, “One set of borrowers might be looking at today's high mortgage rates and deciding they're still likely to stay in their home for another several years. Another set of very recent homeowners may be opting for cash-out refinancing as mortgage rates dipped briefly below 6% in late February.” And equity is reportedly not being used just for home renovations or major improvements, but to support cash flow and pay bills. 

Industry experts warn that “using equity for expenses like vacations, shopping, or even groceries is not the best use of the funds.” Realtor.com® explains that “tapping into your equity isn’t like taking money out of a savings account and that credit card debt is unsecured—if you default, it hurts your credit. But home equity is secured by your house. If you can't pay, you could lose your home to foreclosure.” A good rule of thumb for many is: if you take money out of the house, you should put it back into the house.

Want to know more about the difference between a Home Equity Loan and HELOC? See these reads from CBS News and Equifax. 

The bottom line is that your home can be a great source of wealth and an unrivaled, exponentially growing savings account. But when you draw on that account, we encourage you to consider your reasons, your strategy to pay yourself back and the overall ROI. Please always consult a trusted financial professional to help you make the best decision for you & your home!

All my best,

Bobbi 

Bobbi Decker
DRE#00607999

Broker Associate, Bobbi Decker & Associates
650.346.5352 cell
650.577.3127 efax
www.bobbidecker.com
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Bobbi Decker & Associates fully supports the principles of the Fair Housing Act and the Equal Opportunity Act. For more information, please visit: http://portal.hud.gov/