Equity Calculator

How to Calculate Usable Equity

Total equity is the difference between your property's current market value and the outstanding loan balance. However, you can't access all of your equity. Most lenders will let you borrow up to 80% of your property's value without requiring Lenders Mortgage Insurance (LMI). The portion you can actually access is called usable equity.

Usable equity = (Property value × 80%) − Current loan balance. If the result is negative, you have no usable equity in that property — your loan balance already exceeds the 80% LVR threshold.

Using Equity to Buy Your Next Investment Property

Your usable equity can serve as a deposit (plus costs) on your next property purchase. For example, if you have $200,000 in usable equity, you could potentially use it as a 20% deposit on a property worth up to $1,000,000. This is how many investors grow their portfolio — leveraging existing equity rather than saving cash deposits from scratch.

Keep in mind that a formal valuation from your lender may yield a different figure than online estimates or recent comparable sales. Lender valuations tend to be more conservative, so your actual usable equity may be lower than what this calculator shows. Always speak with your mortgage broker or lender before making financial decisions.