Example: How equity accumulates

A homeowner who purchased a $280,000 home in 2019 with 10% down had roughly $252,000 remaining on their mortgage. If that home is now worth $360,000 and they've paid their balance down to around $230,000 over five years, they have approximately $130,000 in equity — even before accounting for any improvements they've made.

The Minimum: Enough to Close and Cover Costs

At an absolute floor, you need enough equity to pay off your current mortgage, cover the costs of selling (see below), and still have something left to contribute toward your next purchase. If your equity barely covers transaction costs with nothing left for a down payment, you're not really ready — or you'd need to bring cash to the table from another source.

The Standard: 10–20% Down on Your Next Home

Most move-up buyers target using their equity to put at least 10–20% down on their next home. A 20% down payment eliminates private mortgage insurance (PMI), which can add $150–$300+ per month to your payment depending on loan size. For a $450,000 home in Rochester, 20% down is $90,000. That means you'd need your net proceeds — after selling costs and mortgage payoff — to deliver at least that figure.

The Comfortable Position: 20–30%+ Down

Move-up buyers who can put 25–30% or more down on their next home are in a noticeably stronger position — both in terms of monthly cash flow and in terms of negotiating strength when making offers. In a competitive Rochester market where multiple offers are common on desirable homes, a buyer with substantial equity and a strong down payment can often move faster and more confidently than someone scraping together the minimum.

💡 The PMI calculation matters: If your equity will only support a 10–15% down payment on your next home, factor in what PMI will cost you monthly on the new loan. That cost affects whether the move-up makes financial sense at this moment versus waiting another 12–18 months to build more equity. Our guide to understanding PMI for Rochester NY buyers explains how it works and when it can be avoided.

Real Estate Commission

Commission is negotiated and varies by agent and situation, but it's typically one of the largest individual line items in a sale transaction. Budget for this as a percentage of your sale price when calculating net proceeds.

New York State Transfer Tax

In New York, the seller typically pays the state transfer tax, which is $2.00 per $500 of sale price (or 0.4%). On a $350,000 sale, that's $1,400. Additional county or local transfer taxes may apply depending on the municipality.

Attorney Fees

New York is an attorney-closing state. Sellers pay their own attorney, typically in the range of $800–$1,500 for a standard residential transaction in the Rochester area, though this varies by complexity and firm.

Pre-Sale Repairs and Prep

Most sellers invest something in getting their home ready — paint, minor repairs, cleaning, decluttering, staging costs. Even a modest prep investment can be $1,000–$5,000+ depending on the home's condition. This comes out of equity before you ever get to closing.

Buyer Closing Cost Concessions

In some negotiations — particularly when a buyer requests seller concessions to help cover their closing costs — a portion of your proceeds may be redirected. In a strong seller's market this is less common, but it's worth knowing it can happen and budgeting conservatively.

Mortgage Payoff

Your remaining mortgage balance is paid in full at closing — including any prepayment interest that accrues to the payoff date. The payoff amount is slightly higher than your most recent statement balance; request a formal payoff quote from your lender before finalizing your equity calculation.

💡 Rochester move-up insight: Many sellers in the Greater Rochester market are surprised to learn that their current home can sell faster — and for more — than they budgeted for. That upside in their sale price translates directly into more equity heading into the next purchase. Running the numbers on a range of scenarios (conservative, expected, and optimistic sale prices) before you commit to a purchase budget is time well spent.

You haven't owned long enough for equity to meaningfully build

In the first two to three years of a mortgage, the majority of each payment goes toward interest rather than principal. If you bought recently and haven't benefited from significant appreciation, your equity position may not yet justify the transaction costs of selling. Running the net proceeds math honestly is the way to tell.

Your equity would result in a thin down payment with PMI

If selling now would only allow you to put 5–10% down on your next home, the monthly PMI cost on a $400,000+ purchase adds up significantly. Waiting 12–18 months to build more equity — or to build additional savings alongside your equity — can eliminate that cost entirely and meaningfully reduce your monthly payment.

You'd need a bridge loan to manage the timing gap

Some move-up buyers use a bridge loan to purchase their next home before selling their current one — accessing a portion of their equity before the sale closes. This can work well in specific situations but adds cost and complexity. If you're considering this path, understanding how bridge loans work in Rochester NY is a good starting point before talking to a lender.

The timing works in your favor

The spring and early summer market in Rochester tends to favor sellers — strong buyer demand, competitive offers, and shorter days on market mean your current home sells well, which maximizes your equity position heading into your next purchase. Our month-by-month guide to the best time to sell in Rochester outlines how market conditions shift through the year and what that means for sellers in different situations.

1. Get a current market valuation of your home

Online estimates are a starting point, not a number to rely on. A local agent can run a current CMA based on recent comparable sales in your specific neighborhood — a much more accurate picture of what you'd actually net at today's prices.

2. Request a formal mortgage payoff quote

Contact your lender directly for a payoff statement — not just your balance from your most recent statement. The payoff amount includes accrued interest to a specific date and may be slightly higher than your running balance.

3. Run a realistic net proceeds estimate

Subtract your mortgage payoff, estimated selling costs (commission, attorney, transfer tax, prep), and any concessions you might need to offer. What's left is your realistic down payment pool for your next home. Run this at multiple sale price scenarios — conservative, expected, and strong — so you understand the range.

4. Get pre-approved for your next mortgage

Pre-approval for your next purchase is essential before you list your current home — especially in a fast-moving market. It tells you what you can actually qualify for, factors in your expected down payment from equity, and positions you to act quickly when you find the right home. The step-by-step process of getting pre-approved for a mortgage in Rochester NY walks through exactly what lenders look for.

5. Have a plan for the timing gap

In Rochester's market, your current home may sell faster than you expect — sometimes within days. Know in advance whether you'd need a rent-back arrangement, temporary housing, or a bridge solution to manage the gap between selling your current home and closing on your next one. Sellers who think through this ahead of time negotiate better terms and avoid unnecessary stress.

⚠️ Don't skip the net proceeds math

The most common move-up planning mistake isn't a bad decision — it's making a decision without the real numbers. Sellers who base their move-up budget on a rough equity estimate rather than an accurate net proceeds calculation often find themselves short at exactly the wrong moment: when they're already under contract on a new home and the sale of their current one doesn't produce what they expected. Do the math first, then make the move.

How do I find out how much equity I have in my home?

Start with a current market valuation from a local agent — not an online estimate — and subtract your current mortgage payoff amount. The difference is your gross equity. After accounting for selling costs, what remains is your net equity, which is the realistic figure to use for move-up planning.

Can I use home equity to buy my next home before I sell my current one?

In some cases, yes — through a bridge loan or a home equity line of credit (HELOC). Both allow you to access equity before your home sells. Bridge loans are short-term financing solutions specifically designed for this gap period. They add cost and complexity but can work well for sellers who find their next home before selling. Talk to a local lender to understand what you'd qualify for.

What if my equity won't cover 20% down on my next home?

You can still move forward with less than 20% down — many buyers do. The tradeoff is PMI on your new mortgage until your equity in the new home reaches 20%. Whether that's acceptable depends on your monthly budget and how long you expect to stay in the next home. Waiting to build more equity in your current home, or supplementing equity with savings, are both legitimate paths.

How much does it cost to sell a home in Rochester NY?

Total selling costs in Rochester typically run between 7–10% of the sale price when you include commission, attorney fees, New York transfer taxes, prep costs, and any buyer concessions. On a $350,000 sale, that's roughly $24,500–$35,000 coming out of your equity before you see a dollar of net proceeds. Budget conservatively.

Is now a good time to move up in the Rochester market?

Rochester's market has remained consistently active, with strong demand at both the starter and move-up price ranges. Sellers with meaningful equity are generally in a strong position to capitalize on that — particularly in the spring and summer window when demand peaks. The best way to assess your specific timing is to get a current valuation of your home and a pre-approval for your next purchase, then evaluate the numbers honestly with an agent who knows both sides of the transaction.