Home equity calculator

Home Equity Calculator - Buyvest
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What makes this calculator different

The only home equity calculator in Australia that includes LMI

Every other home equity calculator on the market shows your usable equity at 80% LVR and stops there. The big four banks, non-bank lenders, and every major comparison site give you one number based on a single assumption: that you will only borrow to 80% of your property value.

The reality is that many property owners need to borrow beyond 80%. If you are releasing equity for an investment property deposit, funding a renovation, or consolidating debt, knowing your position at 90% and 95% LVR is just as important. But at those higher LVRs, Lenders Mortgage Insurance (LMI) applies, and LMI significantly reduces the net amount you receive.

Our home equity calculator is the first to show your usable equity across all three LVR tiers (80%, 90%, and 95%) with LMI costs factored in automatically. The 90% and 95% results deduct estimated LMI so the figure you see is the true net equity available to you, not a gross estimate that ignores insurance costs. This is the equity calculation your lender will actually use.

Most calculators show you $400,000 in equity at 90% LVR but hide the $22,500 in LMI that reduces your real position to $377,500. Our calculator shows you the net figure from the start, so there are no surprises when you speak to a lender.

The basics

What is home equity?

Home equity is the difference between your property's current market value and the amount you still owe on your mortgage. It is the portion of your property you genuinely own. Your equity grows in two ways: through mortgage repayments reducing your loan balance, and through capital growth increasing your property value. Both contribute to your equity position over time.

Understanding your equity is the starting point for most property decisions. Whether you want to release equity to invest, refinance to a better rate, or simply understand your financial position, the equity calculation is the foundation.

The core formula
Property value minus outstanding loan balance = total home equity
Usable equity: (property value × maximum LVR) minus outstanding loan balance
Three-tier equity calculation

How our home equity calculator works

Enter your property value and your outstanding loan balance. The calculator instantly shows your usable equity at three LVR levels:

80%

Standard LVR

No LMI applies. Your usable equity is (property value × 0.80) minus your loan balance. This is the maximum most lenders will advance without insurance.

90%

LVR with LMI

LMI applies at an estimated 2.25% of property value. The calculator deducts LMI from the gross equity so you see the true net amount available.

95%

Maximum LVR

LMI applies at an estimated 3.93% of property value. The net equity figure reflects the real amount you receive after LMI is deducted.

Worked example — $1,000,000 property with $500,000 loan
80% LVR — usable equity (no LMI)$300,000
90% LVR — usable equity (after $22,500 LMI)$400,000
95% LVR — usable equity (after $39,300 LMI)$410,700

The difference between the 80% and 90% result is $100,000. That additional equity could fund a deposit on an investment property, a major renovation, or a debt consolidation. But without seeing the LMI cost, you would not know whether that extra borrowing is worth the insurance premium. Our calculator makes that comparison instant.

Step by step

How to calculate equity in your home

Estimate your current property value. Check recent comparable sales in your suburb, request a free appraisal from a local agent, or use an online estimate. For lending purposes, the lender will order their own valuation, which may differ from your estimate.

Check your outstanding loan balance. Log into your lender app or check your latest mortgage statement. Use the current balance, not the original loan amount.

Enter both figures into the calculator above. It instantly calculates your usable equity at 80%, 90%, and 95% LVR with LMI costs factored in for the 90% and 95% tiers.

Compare the three results. Decide whether the additional equity available at 90% or 95% LVR is worth the LMI cost. In many cases, the extra funds unlock a deposit for an investment property or fund a renovation that adds more value than the LMI premium.

Speak to Buyvest. Our mortgage broker team can verify your figures with a formal valuation, check if you qualify for an LMI waiver (which would eliminate the LMI cost entirely), and compare equity release options across 35+ lenders at $0 cost.

Understanding the numbers

Total equity vs usable equity vs net equity

These three terms are often confused, but they mean very different things when you are planning to borrow against your property:

Total

Total equity

Property value minus loan balance. The full amount you own. Not all of this is accessible for borrowing because lenders require a security buffer.

Usable

Usable equity

(Property value × LVR) minus loan balance. The amount a lender will allow you to access. At 80% LVR, this is the standard figure. Most calculators stop here.

Net

Net equity (after LMI)

Usable equity minus LMI cost. The actual amount you receive at 90% or 95% LVR after the insurance premium is deducted. Only our calculator shows this figure.

What LMI costs at each tier

How Lenders Mortgage Insurance affects your equity

When you borrow above 80% of your property value, lenders charge Lenders Mortgage Insurance (LMI). LMI protects the lender (not you) if you default and the property sale does not cover the outstanding debt. The cost is capitalised into your loan, meaning it increases your total borrowing amount.

LMI costs vary by lender, LVR, loan size, property type, and employment type. Our calculator uses conservative industry estimates (2.25% at 90% LVR, 3.93% at 95% LVR) to give you a realistic net equity figure. Your actual LMI may be higher or lower depending on your lender and circumstances.

Ways to avoid LMI

Keep your LVR at 80% or below. Use a family guarantee to reduce your effective LVR. Qualify for a professional LMI waiver (doctors, lawyers, accountants). Access the Home Guarantee Scheme (first home buyers, 5% deposit).

When paying LMI makes sense

When the additional equity unlocks an investment opportunity with returns greater than the LMI cost. When property prices are rising and waiting to save more deposit means paying a higher price. When the LMI is tax-deductible (investment properties).

Using your equity

What can you do with your home equity?

01

Buy an investment property

Use your equity as the deposit for an investment property. At 80% LVR, $300,000 in usable equity could serve as the deposit on a property worth up to $1,500,000.

02

Renovate or build

Release equity to fund renovations that add value to your property, or finance a construction project. Strategic renovations can increase your property value by more than the cost of the work.

03

Consolidate debt

Use your equity to consolidate higher-interest debts (credit cards, personal loans, car loans) into your mortgage at a lower rate. This can reduce your total interest cost significantly.

You can also use equity to upgrade to your next home, fund a bridging loan while buying and selling simultaneously, or access funds for other financial goals. Our mortgage repayment calculator helps you understand how the increased loan affects your repayments.

Growing your position

How to build equity in your home

01

Extra repayments

Every additional dollar reduces your loan balance. Switching from monthly to fortnightly repayments adds one full extra repayment per year without changing your budget.

02

Capital growth

Property value increases push your equity higher without any action on your part. Purchasing in a high-demand suburb with strong growth fundamentals maximises passive equity accumulation.

03

Strategic renovation

Value-adding improvements (kitchen, bathroom, additional bedrooms) can increase your property value by more than the cost. Cosmetic updates often deliver the highest return on investment.

Lender perspective

How lenders calculate home equity

Lenders order their own property valuation (not a real estate appraisal) to determine your property value. This bank valuation is often more conservative than a real estate agent estimate. The lender then applies their maximum LVR (typically 80% without LMI) and subtracts your outstanding loan to determine usable equity.

Beyond the equity calculation, lenders assess your income, existing debts, credit profile, employment type, and property type. The equity calculation sets the ceiling. Your financial profile determines whether you can reach it. Read our bank valuations guide to understand how lenders value properties.

Common questions

Home equity calculator FAQs

Subtract your outstanding loan balance from your property's current market value. For example, if your property is worth $900,000 and you owe $500,000, your total equity is $400,000. To find usable equity, apply your chosen LVR: ($900,000 × 0.80) minus $500,000 = $220,000 at 80% LVR. Our calculator also shows you the net equity at 90% and 95% LVR after LMI is deducted.
Enter your property value and outstanding loan balance into the home equity calculator above. It shows your usable equity at 80%, 90%, and 95% LVR instantly. If you are unsure of your property value, check recent comparable sales in your suburb or request a free appraisal from a local agent. For lending purposes, contact Buyvest for a more accurate assessment.
Total equity is the full difference between your property value and loan balance. Usable equity is the portion a lender will allow you to access, after retaining a security buffer. At 80% LVR, the lender keeps a 20% buffer. So if your total equity is $400,000, your usable equity at 80% LVR will be less. Our calculator shows both scenarios.
Because most property decisions require understanding your full range of options. If you are considering an investment purchase and your usable equity at 80% is not quite enough for the deposit, the 90% tier may bridge the gap. But at 90% and 95%, LMI applies and reduces your net position. Our calculator factors LMI in so you can compare all three options side by side with accurate net figures.
Lenders Mortgage Insurance is charged when borrowing above 80% LVR and is capitalised into the loan. Our calculator deducts estimated LMI from the 90% and 95% results so the figure displayed is the true net equity available, not a gross estimate that ignores insurance costs. This is what makes our calculator unique in Australia.
Yes. Keep your total borrowing at 80% LVR or below. Use a family guarantee to reduce your effective LVR. Qualify for a professional LMI waiver (available to doctors, lawyers, accountants, and other eligible professions). Our mortgage broker team can assess which option applies to your situation.
Yes. The equity calculation works the same way for investment properties. Enter the property value and outstanding loan balance. Note that some lenders cap investment property LVR at 80% or 90% (not 95%), and LMI rates may be slightly higher for investment loans. Confirm the applicable LVR with your lender or contact Buyvest for guidance.
The calculator uses conservative industry estimates (2.25% at 90% LVR, 3.93% at 95% LVR). Actual LMI varies by lender, loan amount, property type, employment type (PAYG vs self-employed), and whether you are a first home buyer. The figures are a reliable guide for planning, but your actual LMI will be confirmed during the loan application process.
Running a fresh equity calculation every 6 to 12 months is a good habit. Your equity changes as you make repayments (reducing the loan balance) and as property values move. If you are actively planning to borrow against your equity, run a calculation immediately before speaking to a lender or mortgage broker.
Negative equity means you owe more than your property is currently worth. This can happen if property values decline or if you borrowed at a very high LVR. In this situation, you cannot access additional equity. Focus on making regular repayments to reduce the loan balance and wait for the market to recover. Contact Buyvest to discuss your options.

Ready to use your equity?

Speak with the Buyvest team for a personalised assessment of your equity position, LMI options, and borrowing strategy across 35+ lenders. $0 cost.

Book a free consultation