Equity
Equity is the part of your home's value that you own.
1 min read Buying a Home
What it means
Equity is the part of your home's value that you own. It's the property's value minus the amount you still owe on your mortgage.
Example
Your home is worth £350,000 and you owe £200,000 on your mortgage. Based on this you have £150,000 of equity.
Why it matters
Building equity increases the share of your home that belongs to you.
Equity can increase if you repay your mortgage or if your property's value rises.
Can equity go down?
Yes. If property prices fall, your equity may reduce.