Your home equity is the property's current value minus what you owe. This equity calculator also estimates how much extra borrowing would fit within 80% and 90% loan-to-value ratios (LVR). Your lender still needs to accept the valuation and check you can afford the larger debt.
For an $800,000 home with a $500,000 loan, total equity is $300,000. At 80% LVR, the extra borrowing allowance is $140,000, before costs. Use the $140,000 figure when planning extra borrowing for a renovation or another deposit.
How to use the equity calculator
Enter the property's current estimated value, the outstanding loan balance and whether it is an owner-occupied or investment property. Use the total relevant debt secured against it, rather than just one loan split.
The result shows total equity, current LVR, an 80% estimate and a separate 90% scenario. The property-type selection currently uses the same calculation for both choices. It does not compare lender cash-out policies or approve borrowing at 90%.
The figures exclude application costs and any lenders mortgage insurance (LMI) or other low-deposit premium. They do not assess your income, expenses, other debts or proposed use of the money. For that part of the decision, use our borrowing calculator and discuss the full application with a broker.
If the tool shows no accessible equity, it means no positive amount within its assumed limit. It does not establish that selling is your only option. The tool also rejects a loan balance above the property value; negative equity can occur even though this calculator cannot model it.
How much equity is in my house?
Total equity = current property value - outstanding secured loan balance.
A home worth $500,000 with a $400,000 loan has $100,000 in equity. If it later becomes worth $700,000 and the loan falls to $350,000, equity is $350,000 and LVR is 50%.
That is a hypothetical change, not a prediction. Equity can fall if the property loses value or you increase the debt. An online price estimate is a starting point; the lender uses a valuation it accepts.
How much equity can I use?
Potential extra borrowing = property value x proposed LVR limit - existing debt.
At 80% LVR, an $800,000 property supports $640,000 of total secured borrowing. Subtract the $500,000 already owed and the gap is $140,000.
Releasing that amount would increase the loan from $500,000 to $640,000. It is borrowed money, so allow for its repayments as well as the loan on any new property. Our usable equity guide explains how the two loans can fit together.
80% is a useful planning benchmark because LMI often applies above it. Some lenders and products allow higher lending, subject to their cash-out rules and assessment. A 90% calculation is a scenario to investigate, not an entitlement.
Worked examples: how much usable equity do you have?
These examples reproduce the calculator's formulas. The 90% column is before any financed premium or fees, which could consume part of the allowance. Neither column is a lender offer.
| Property value | Existing loan | Total equity | Extra borrowing at 80% | Extra borrowing at 90% |
|---|---|---|---|---|
| $600,000 | $300,000 | $300,000 | $180,000 | $240,000 |
| $800,000 | $500,000 | $300,000 | $140,000 | $220,000 |
| $1,000,000 | $600,000 | $400,000 | $200,000 | $300,000 |
| $1,200,000 | $750,000 | $450,000 | $210,000 | $330,000 |
| $1,500,000 | $900,000 | $600,000 | $300,000 | $450,000 |
For example, financing an example $10,000 premium within the $220,000 allowance would leave $210,000 for your planned purchase or renovation, before other costs. The $10,000 is an example allowance, not an LMI quote. Check the lender's maximum LVR including financed costs and use our LMI calculator only as an estimate.
How lenders decide how much equity you can access
Bank valuation vs market estimate
The bank's accepted valuation can differ from an agent's appraisal or an online estimate. Ask which property details and comparable sales the valuation uses if the result is lower than you expected.
A lower valuation reduces the borrowing allowance. If the $800,000 estimate comes back at $750,000, an 80% limit falls from $640,000 to $600,000. With $500,000 already owed, potential extra borrowing falls from $140,000 to $100,000.
Before applying to several lenders, ask your broker which valuation options are available and what each requires. See CommBank's valuation explanation.
Your repayments and purpose still need to fit
The lender considers income, living expenses, existing repayments, credit commitments, repayment history and the security. It may ask for renovation quotes, a purchase contract or other evidence of how the extra funds will be used.
Property type, location, loan amount and purpose can affect the maximum LVR. Do not use a general purchase-loan maximum as a promise that the same lender will allow cash-out to that limit.
Our LVR calculator shows the ratio, while how much home can I afford? helps connect the loan with a household budget.
Seven ways to build your home equity
- Reduce principal through your regular repayments.
- Make affordable extra repayments where your product allows them.
- Put a bonus or other spare cash towards principal after keeping an emergency reserve.
- Choose a shorter term if the higher required repayment fits your budget.
- Avoid increasing the mortgage for spending that does not need long-term finance.
- Consider improvements on their merits; renovation cost does not guarantee the same increase in value.
- Review the property's value when there is evidence it has changed, rather than assuming a fixed annual growth rate.
An offset account can reduce interest while keeping cash separate from the loan. Its balance is not the same as reducing the contractual loan balance for every lender's LVR assessment. Compare it with extra repayments before moving money.
Our guide to building equity goes into these choices in more detail.
The video gives background on equity. Use the written conditions and your lender's current assessment for a borrowing decision.
Ways to access your home equity
| Option | What happens | What to compare |
|---|---|---|
| Loan top-up or additional split | Your current lender approves more borrowing | Rate, fees, purpose restrictions, term and total repayments |
| Cash-out refinance | A new loan repays the old debt and includes approved extra funds | Switching costs, valuation, LMI and the remaining term |
| Line of credit | An approved revolving limit can be drawn and repaid under its terms | Availability, rate, fees, repayment requirements and how you will reduce debt |
None is automatically cheapest. Compare the whole arrangement, including whether a new 30 year term stretches existing debt over longer than planned. Our refinancing guide explains that comparison.
For lender-specific starting points, read our CommBank review, Bankwest review and ANZ review. Compare the current product, fees and conditions for taking out extra borrowing before choosing a lender.
What can I use equity for?
Approved extra borrowing can help fund renovations, a deposit and buying costs on another property, or other permitted purposes. The lender decides what it will accept and which documents it needs.
For another purchase, include stamp duty, legal work, registration and other buying costs in your deposit budget. Equity that covers the deposit does not establish you can service both loans.
Be careful about moving short-term spending into a long mortgage. A lower interest rate can still cost more overall if repayment is stretched over many years. Moneysmart's debt-consolidation guidance explains that trade-off and the risk of securing debt against your home.
Tax treatment depends on what the borrowed money funds, not simply which property secures it. Get tax advice before mixing personal and investment borrowing. A separate split can help keep records clear, but does not by itself make interest deductible.
Is equity different for an investment property?
The subtraction is the same for both: value less debt. What can change is the lender's product, rate, maximum LVR, rental-income assessment and cash-out policy.
This calculator uses the same 80% and 90% scenarios for both property types. Check the actual lender proposal, including LMI and repayments, before using either estimate as your budget.
Can equity help a family member buy their first home?
A homeowner may consider a gift funded from savings or approved borrowing, or a limited guarantor home loan. These are different commitments. Borrowing to make a gift creates repayments for the homeowner; providing a guarantee puts the agreed security at risk if the borrower does not meet their obligations.
The buyer should also check the Australian Government 5% Deposit Scheme. Eligible owner-occupiers may buy with a smaller deposit without LMI through a participating lender, subject to the scheme and lending conditions. It is not an equity-release scheme for an existing homeowner's investment purchase.
Compare those options before deciding the family home needs to support the purchase. The buyer still needs sufficient income and cash for any costs outside the approved loan.
Home equity FAQs
What's the difference between total equity and usable equity?
Total equity is value minus debt. Potential usable equity is the extra borrowing that fits within a chosen LVR limit, subject to lender approval. At $800,000 value and $500,000 debt, these are $300,000 total and $140,000 at an 80% limit.
Why is my bank's property valuation lower than expected?
The accepted valuation may use different comparable sales, property information or timing from your estimate. Ask what evidence can be reviewed. There is no universal rule that bank valuations are 5% to 15% below market value.
How can I increase my usable equity quickly?
Paying down your loan can leave more room to borrow within the lender's LVR limit. A supported higher valuation may also help, but renovations and market growth are uncertain. Avoid taking on costs purely to chase an assumed valuation uplift.
How much of my equity can I access?
Start with the 80% formula, then check your income, expenses, purpose and lender limits. The calculator's 90% result does not mean that amount will be approved or arrive as cash after fees and LMI.
What factors affect whether I can access equity?
The valuation, secured debt, repayment capacity, credit history, property and proposed use of funds all matter. A strong equity position can still be paired with insufficient income for additional repayments.
What are the risks when borrowing against equity?
You take on more debt secured by property. Repayments can become harder if rates or expenses rise or income falls. A fall in value also reduces the remaining equity. Keep an emergency reserve and compare repayments over the term you intend to use.
How much equity will I have in 5 years?
That depends on the future property value and loan balance. As a hypothetical example, $800,000 growing at 4% a year becomes about $973,322 after 5 years. If debt is $450,000 then, total equity is about $523,322. Neither the growth nor the balance is a forecast; also model flat or falling values.
Does the government guarantee let me release more equity?
The 5% Deposit Scheme supports eligible home purchases through participating lenders. It does not provide a general guarantee for cash-out or investment equity borrowing. A family guarantee is a separate arrangement with separate risks.
Should I use my home equity?
Start with the purpose and the extra repayment you can comfortably carry. Bring your loan balances, an estimate of the property value and the amount you need. We can compare whether a top-up or refinance may suit you and check whether keeping your current loan makes more sense.
Request a free assessment or call 1300 088 065. You do not need to apply to multiple banks just to work out your starting position.
References
Information checked 12 September 2026.