Why homeowners love rising property prices

What is home equity?

Put simply, home equity is the difference between your property's current value and how much you still owe on the mortgage. As you pay off your loan and your property's value increases, you build more equity.

This can happen in two ways:

• Market growth – Property values go up due to demand, location, or broader market trends.

• Loan repayments – Each mortgage repayment chips away at your debt, increasing your stake in the home.

Why is equity so valuable?

Equity gives you options — big ones. It can become your financial stepping stone for future goals. Here’s how homeowners often use it:

• Buy an Investment Property — Many Aussies use their existing equity as a deposit for a second home or investment property, bypassing the savings slog altogether.

• Renovate or Upgrade — Got big ideas for a new kitchen, extra bedroom, or home office? Tapping into equity can help fund lifestyle improvements — and increase your home's value even further.

• Help Your Kids Buy — If you're a parent, you can use your equity to go guarantor for your child’s home loan — helping them get into the market faster without needing a massive deposit.

• Refinance and Consolidate Debt — Equity can also be used to refinance your loan or roll high-interest debts (like credit cards or personal loans) into your mortgage, potentially reducing your overall repayments.

Why starting sooner matters

The sooner you get into the market, the sooner you start building equity. If your dream suburb feels out of reach, consider:

• Expanding your search radius
• Choosing an up-and-coming area
• Prioritising getting your foot in the door over the “perfect” home

Over time, that first step could unlock major opportunities — both for yourself and your family.

Helpful Resources:

• How to calculate “useable equity”
• How to buy with a family guarantor

Start building equity!

Take the first step with our Free New Home Pre-Qualifier. It only takes a few minutes to check if you’re eligible for low deposit home options and grants.