Home Equity Calculator Australia
How much equity you could actually borrow against — the usable equity at 80% of your property's value less the loan — plus what a change in value does to it and what it buys as a deposit on the next property.
Total equity is value less loan.
| Loan | $550,000.00 |
|---|---|
| Usable equity | $170,000.00 |
| Locked 20% buffer | $180,000.00 |
How the home equity calculator works
Total equity is value less loan. Lenders let you borrow to 80% of the value without lenders mortgage insurance, so usable equity is 80% of value less the loan; the rest of your equity is the locked buffer. Above 80% (to the LVR you choose) is the LMI zone. A 20% deposit plus about 5% costs on a target purchase is what usable equity has to cover, which gives the maximum purchase price it supports.
Formula: Usable = 0.8 × value − loan · locked = (value − loan) − usable · max purchase = usable ÷ 0.25 · need = 0.25 × target price
Where these figures come from
This calculator uses standard Australian lending conventions rather than any one lender's policy — every figure on the page is computed directly from the value and loan balance you enter.
- Equity and borrowing against your home — ASIC's MoneySmart explains home equity, how lenders let you access it, and the risks of increasing your loan: moneysmart.gov.au.
- The 80% LVR / LMI convention — lending above 80% of a property's value generally attracts lenders mortgage insurance. This is a near-universal lender practice, not a law; individual lenders set their own LVR caps and LMI pricing, and some professions get LMI waivers — ASIC MoneySmart, moneysmart.gov.au home loans.
- The 20% deposit + ~5% costs rule of thumb — purchase costs (stamp duty, transfer and legal fees) vary by state and price; ~5% is a planning approximation only. State revenue offices publish exact duty scales — e.g. revenue.nsw.gov.au.
Last checked: July 2026. Value-change scenarios are illustrative what-ifs, not forecasts. Actual accessible equity depends on the lender's own valuation, LVR policy and serviceability assessment. General information and estimates only — not financial advice.
Understanding your resultSelect the question that matches where you are right now.
Three numbers matter: total equity, usable equity, and your LVR — and only one of them is money a bank will actually hand over.
The hero number is the honest oneUsable equity — 80% of value minus loan — is what lenders will typically release without LMI. Total equity flatters you by $180,000 at the defaults; the buffer row shows exactly what's locked away.
LVR is the gatekeeperAt 61.1% LVR you're comfortably under the 80% line with room to draw. As your LVR approaches 80%, usable equity shrinks toward zero — cross it and you're in LMI territory for any new lending.
It's an estimate until the valuer visitsEvery figure keys off the value you typed. The lender's valuation — often more conservative than online estimates — is the number that actually gets used when you apply.
Equity builds from both ends: pay the loan down, and let the value grow.
Extra repayments compound twiceEvery extra dollar off the principal is a dollar of equity now, plus all the interest it never accrues. Small regular extras move the LVR faster than most people expect.
Mortgage Repayment Calculator → Growth does the heavy lifting — leveragedBecause the loan doesn't move, a 5% value rise lifts equity 12.9% at the defaults. That same leverage works in reverse in a downturn, which is exactly why the 20% buffer exists.
Capital Growth Calculator → A revaluation can unlock equity for freeIf comparable sales in your street have risen since you borrowed, asking your lender to revalue (or refinancing with a fresh valuation) can lift usable equity without repaying a cent.
Usable equity is a tool — the discipline is matching the borrowing to something that outlasts the debt.
Investment depositThe classic play: ~25% of the target price covers a 20% deposit plus costs. At the defaults, $170,000 usable supports a purchase up to about $680,000 — the Advanced planner checks your own numbers.
Rental Yield Calculator → RenovationsBorrowing against equity to fund work that adds value can be self-reinforcing — the loan rises, but so can the valuation. Cosmetic works rarely return their cost; structural space more often does.
Cars and consumables — think twiceEquity debt is cheap per year but runs for decades: a car financed over a 25-year home loan can cost more in total interest than a dearer short-term loan. Match the loan term to the asset's life.
Car Loan Calculator →Equity tells you what the bank can secure — these tools cover what happens next.
Check the income sideServiceability, not security, is where most equity plans stall. See what your income supports before falling in love with a purchase price.
Borrowing Capacity Calculator → Going above 80%?Price the LMI premium before you commit — sometimes it's worth paying to move sooner, but it should be a deliberate trade, not a surprise at settlement.
LMI Calculator → Price the new repaymentAny equity draw means a bigger loan. Model the new repayment — and stress it a couple of percentage points higher — before signing anything.
Mortgage Repayment Calculator → Keep exploring: LVR · Stamp Duty NSW · Offset Savings Related calculators 🛡️LMI CalculatorCost of borrowing over 80% 📏LVR CalculatorLoan-to-value ratio 🏦Borrowing CapacityWhat your income supports 🏠Mortgage RepaymentPrice the bigger loan 📈Capital GrowthProject your value 🔑Rental YieldIncome on the next buy You might also be interested in 🧾Stamp Duty NSWCosts on the next purchase 💳Offset SavingsOffset vs redraw value 🔑First Home BuyerDeposit and scheme help 💰Net WorthAssets minus debts 💹Compound InterestGrowth over time 🎯Savings GoalSave the shortfall Rate this calculatorQuick answers
The usable equity rule 80% × value − loan
Usable (accessible) equity is what a lender will typically let you borrow against without lenders mortgage insurance: 80% of your property's value, minus your current loan balance. It's smaller than your total equity because the bank keeps a 20% buffer locked in the home.
| Formula | 80% × value − loan |
|---|---|
| Total equity | Value − loan |
| The difference | A locked 20% buffer |
- Above 80% LVR LMI usually applies
- Floor Never below $0
Worked example — the defaults $170,000 usable
On a $900,000 home with a $550,000 loan: total equity is $350,000, but usable equity is 80% × $900,000 − $550,000 = $720,000 − $550,000 = $170,000. The other $180,000 (20% of the value) stays locked as the lender's buffer. Current LVR: 61.1%.
| Total equity | $350,000 |
|---|---|
| Usable at 80% | $170,000 |
| Locked buffer | $180,000 |
- Current LVR 61.1%
- At 90% LVR (LMI) $260,000 usable
The 80% no-LMI ceiling 80% LVR
Lenders will generally lend up to 80% of a property's value without charging lenders mortgage insurance. Your LVR (loan ÷ value) tells you where you sit: at the defaults it's $550,000 ÷ $900,000 = 61.1%, comfortably under the line with room to draw equity.
| No-LMI ceiling | 80% LVR |
|---|---|
| LVR at defaults | 61.1% |
| Above 80% | LMI territory |
- LVR formula Loan ÷ value
- Lower LVR More usable equity
Equity as an investment deposit ~25% of the price
To buy an investment property without LMI you typically need about 25% of the purchase price: a 20% deposit plus roughly 5% for stamp duty and other costs. So usable equity supports a price of about usable ÷ 0.25 — $170,000 supports up to ~$680,000 at the defaults.
| Deposit | 20% of price |
|---|---|
| Costs | ~5% of price |
| $170,000 usable | ~$680,000 price |
- Costs vary By state and price
- Still required Serviceability on both loans
Borrowing above 80% LVR LMI usually applies
Lenders will often go to 85–90% LVR, but the lending above 80% generally attracts lenders mortgage insurance — a premium that can run to thousands of dollars and protects the lender, not you. At the defaults, 90% LVR lifts usable equity from $170,000 to $260,000, minus whatever LMI costs.
| 85% LVR usable | $215,000 |
|---|---|
| 90% LVR usable | $260,000 |
| The catch | LMI premium |
- Each 5% step (defaults) +$45,000 usable
- Estimate the premium LMI Calculator
How equity is actually accessed Top-up · refinance · equity loan
Equity is accessed through new borrowing: a loan top-up, a refinance, or a separate equity loan or line of credit. Redraw isn't equity access — it only returns extra repayments you've already made. An offset account is just your own savings; withdrawing it doesn't touch the loan.
| Top-up | Same loan, higher limit |
|---|---|
| Refinance | New loan, cash out |
| Redraw / offset | Not equity access |
- All routes Bigger loan, bigger repayments
- Lender checks Valuation + serviceability
Equity doesn't guarantee approval Serviceability still applies
Equity is only the security side of a loan. Lenders separately assess serviceability — whether your income covers the bigger repayments after expenses, existing debts and a rate buffer. Plenty of equity with insufficient income still means no loan.
| Equity | The security side |
|---|---|
| Serviceability | The income side |
| Both | Required for approval |
- Assessed with A rate buffer on top
- Check yours Borrowing Capacity Calculator
Negative equity Loan > value
If your loan balance exceeds your property's value — say a $600,000 loan on a home now worth $560,000 — you have negative equity: usable equity is $0 and refinancing is difficult. It usually only crystallises if you're forced to sell; keeping up repayments while the market recovers is the common path through.
| Definition | Loan balance > value |
|---|---|
| Usable equity | $0 |
| Refinancing | Difficult |
- Only crystallises If you must sell
- Exit Repayments + time / growth
Worked examples
| Inputs | Usable equity (to 80% LVR) | Note |
|---|---|---|
| $900,000 home with a $550,000 loan | $170,000 | $170,000 usable; $180,000 locked; supports a $680,000 purchase |
| The same home after 10% growth | $242,000 | $242,000 usable |
| Negative equity | $0 | nothing usable; $20,000 under water |
The sources behind this calculator
- Revenue NSW — Transfer duty — the NSW transfer duty scale the rent-vs-buy page applies, alongside each other state's published scale
- Moneysmart — Buying a house — the upfront costs of buying: deposit, duty, lenders mortgage insurance and conveyancing
- Moneysmart (ASIC) — the regulator's guidance on buying, borrowing and lenders mortgage insurance
Last checked: July 2026. Duty scales are the state revenue offices' own; they change at each state budget and are verified against the office when they do.