Home Business How homeowners can lock in steep rise in their home’s value
Buy homebuilder shares—A simpler hedge involves homebuilder stocks. Kurt Fillmore of Wealth Trac Financial LLC in Bingham Farms, Mich., says one of his clients had a home that had appreciated considerably, but the client wasn’t planning to move for a year or two. As a hedge, he purchased a put option on behalf of the client to sell shares of homebuilder stocks at a fixed price in the future, assuming that if property values fell, so would the value of those shares.
Put your money in the broader market—Stocks can offer another, much riskier, way to offset potential losses in home equity, by using that equity to make money in the market. As a rule, financial advisers are loath to have clients risk their home equity on Wall Street, but in some instances it can make sense, says J.P. Maroney, chief executive of Harbor City Capital Corp. in Melbourne, Fla.
Use home equity to pay down debt—A simpler way to profit from home equity is to use it to create savings by borrowing against it and using the money to pay off higher-rate debt, such as credit-card balances. Read the full story.
Source: https://www.businessreport.com/business/how-homeowners-can-lock-in-steep-rise-in-their-homes-value