Home Equity Calculator
How much equity you hold in your property.
Calculate home equity as the current property value minus outstanding mortgage balance. Free educational calculator with methodology and a worked example.
What this tool does
Enter property value and mortgage balance. The tool shows equity in cash terms and as a percentage of the property.
Enter Values
Formula Used
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Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
Home equity is the difference between what your property is worth and what you owe on it. A 400,000 property with a 180,000 mortgage has 220,000 of equity — 55% of the property. Equity is the source of funds for home-equity loans, downsizing, and the deposit on a next home.
Quick example
With property value of 400,000 and mortgage balance of 180,000, the result is 220,000.00. Change any figure and watch the output shift — it's often more useful to see the pattern than to memorise the formula.
Which inputs matter most
You enter Property Value and Mortgage Balance. Not every input has equal weight. Flip one at a time toward extreme values to feel which ones move the needle most for your situation.
What's happening under the hood
Equity = current property value minus outstanding mortgage balance. Ignores selling costs. The formula is listed in full below. If the number looks off, you can retrace the calculation by hand — that's the point of showing the working.
Why this matters before you sign
A mortgage is usually the biggest single financial commitment a person makes. The difference between a well-chosen product and a hasty one can run into tens of thousands over the life of the loan. Running the numbers here before committing is the cheapest form of due diligence available.
What this doesn't capture
The figure excludes arrangement fees, valuation costs, legal fees, insurance, and any early-repayment charges — those can add several thousand to the headline cost. Rate changes at renewal for fixed-term deals will shift the picture further. Use this for the core interest/principal math and add the other costs on top.
Where to go next
This calculation rarely sits alone in a planning exercise. If you're running these numbers, you'll probably also want the loan to value calculator, the equity buildup calculator, and the negative equity calculator — each one answers a different question in the same territory. Treating them as a set rather than in isolation usually produces a more honest picture.
Home equity produces a cash figure based on the inputs provided.
Inputs
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
Equity = current property value minus outstanding mortgage balance. Ignores selling costs.
References
Frequently Asked Questions
Is equity the same as usable cash?
What about negative equity?
How do I raise my equity?
Should I count deposit separately?
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