UPDATE: Homeowners and potential buyers are urged to conduct their annual real estate checkup this December to ensure financial stability in 2025. With the housing market showing signs of fluctuation, now is the critical time to assess your real estate investments.
For those who do not yet own property, the message is clear: now is the time to start investing. Meeting with a Realtor® can help you craft a strategy for your first home purchase, setting you up for long-term financial growth.
If you already own property, it’s essential to review key areas of your real estate portfolio immediately. Begin by obtaining a market analysis from your Realtor®. Home values have significantly appreciated over the years, evidenced by the rise of Baseline Subdivision homes in Boulder from under $30,000 in 1978 to approximately $750,000 today. This annual value update is crucial for your financial statements and future investment plans.
Next, review your real estate insurance coverage. Ensure it reflects current replacement costs, especially after the rising expenses seen since the Marshall Fire. Consider additional policies like flood insurance to protect against unexpected events, as experienced during the 2013 floods.
Don’t overlook the importance of checking your loan balance. For homeowners with a 30-year amortized loan, equity builds gradually, particularly after the first 14 years. Keep your current loan balance on your financial statement to understand your net worth accurately.
Another critical component is evaluating your mortgage insurance. Many homeowners with low down payments may be paying Private Mortgage Insurance (PMI). With rising property values, you might qualify for PMI removal, which could lower your monthly payments. Contact your lender to explore this option or discuss refinancing.
Check your interest rate as well. Interest rates were higher in 2024 but have dropped slightly in 2025. If you’ve had your mortgage for five years, consider refinancing to a lower rate, which can significantly reduce your monthly payments. Ask your lender about a potential loan recast, which can help maintain your amortization schedule without extending your loan term.
For those contemplating refinancing, weigh your options between a 15-year and a 30-year loan. While a 15-year term offers faster principal reduction, it results in higher monthly payments. Alternatively, some lenders may allow you to recast your existing loan at today’s rates, providing a lower interest rate without extending the term unnecessarily.
It’s also wise to meet with your real estate lending professional and Realtor. Knowing your current property values and loan balances allows for informed decisions about expanding your real estate portfolio. If your family is growing, consider acquiring a larger home while simultaneously building your investments. Refinancing your current home can provide cash for a down payment on a new residence.
Don’t forget to schedule a home inspection. Regular inspections can uncover hidden issues, especially after winter months. A proactive approach helps prevent minor repairs from turning into major expenses, ensuring your property remains in good condition.
Finally, explore the option of a home warranty. These policies can cover essential home components, protecting against costly repairs. If you’re worried about potential failures, assess the costs and coverage options available.
Start your real estate checkup today by reaching out to your Realtor, lending professional, and home inspector. Protect your investment and prepare for a prosperous year ahead.
For expert insights, contact Duane Duggan, a seasoned Realtor® with over 3,000 transactions since 1978, at [email protected]. Stay informed with the latest in real estate and home trends through atHome Colorado, your trusted source for local insights.
