Home ownership is a leveraged investment for most people. A lot of people only put 10% or less down these days. So taking payments out of the equation to make it simple (you either pay rent or pay a mortgage), a 1% increase in the price of the home is like a 10% rate of return on their downpayment. Problem with leverage however, is a 1% decline takes away just as quickly. And since transaction costs can run up to 7% to buy or even more to sell, even a property increasing in value will take several years to break even on. Things have been bad here in Michigan for sellers. I see a lot of them bringing money to closings instead of recieving a check, or at the very least thinking they have more equity than they really do. Don't use your house as an ATM!
Sage advice! Actually, there's probably a "smart" and financially-savvy way to do this, but only under ideal and very conservative circumstances; i.e., assume your house has appreciated much less than it has, and only when you've taken a reasonable dent out of your owed principal.