Most homeowners have a rough idea of what their home is worth. Fewer know how much of that value they could actually put to work. That might be for a renovation, a move to a bigger place, an investment property or simply a bit more financial breathing room.
That's where equity comes in. Here's a plain-English look at what it is, how you can access it, and what to think about before you do.
Equity is the difference between what your home is worth today and what you still owe on it. If your home is worth $900,000 and your loan balance is $300,000, you have $600,000 in equity.
Your equity grows in two ways: as you pay down your loan, and as your home rises in value. For many Brisbane homeowners, that second part has done a lot of the heavy lifting. According to Cotality, Brisbane home values are 64.1% higher than they were five years ago. As a rough illustration, a home worth $600,000 five years ago would be worth around $985,000 today if it had grown in line with the city-wide average.
You can't usually borrow against all of your equity. As a general rule, lenders will let you borrow up to 80% of your home's value, minus what you already owe. This is called your usable equity.
Using the same example:
It's possible to borrow more than 80% of your home's value, but you'll usually have to pay Lenders Mortgage Insurance (LMI). LMI protects the lender – not you – if a loan isn't repaid, and it can add thousands of dollars to the cost of borrowing.
There's one more important piece. Having equity doesn't automatically mean you can borrow it. The lender still needs to be confident you can afford the repayments on a bigger loan, based on your income, expenses and other debts. Our article on how borrowing power has changed in 2026 explains what they look at.
Depending on your circumstances, equity can help with a range of goals. Some of the most common are:
If you're thinking about an investment property, our guide to rental yields in 2026 is a good place to start.
Some homeowners use equity to pay off higher-interest debts such as credit cards, car loans or personal loans. Rolling them into the home loan leaves one repayment instead of several, usually at a lower interest rate.
That can make life simpler, but there's a catch worth understanding. A lower rate spread over a much longer term can end up costing more in total. Here's an example:
Illustrative example only. The interest rates are assumptions, not rates on offer, and the figures ignore fees.
So consolidation can work well, especially if you keep paying the debt down quickly – often in its own loan split so it's easy to track. It isn't right for everyone, though, and it's worth talking through carefully before you decide.
There are four common ways to do it. Each suits a different situation.
Top-up. Your existing loan is increased and you receive the extra as a lump sum. Lenders will generally ask what the money is for.
Separate loan split. Instead of adding to your current loan, you set up a second loan account secured by your home. This keeps money for different purposes apart, which makes it easier to track and pay off. If the funds are for an investment, your accountant can explain why keeping that borrowing separate can matter at tax time.
Refinancing. You replace your current loan with a new one, often with a different lender, and borrow extra at the same time. It's also a chance to review your interest rate and loan features – though you'll need to meet the new lender's criteria, and switching can come with costs.
Line of credit. You get an approved limit that you can draw on as needed, and you generally only pay interest on what you use. It's flexible, but there's often no set timetable for paying it back, so it works best when you have a clear plan.
Using equity means borrowing more, so your total debt and usually your repayments will go up. Before you go ahead, it's worth asking yourself a few questions:
Your home is the security for the loan. If you fall behind on repayments, your home could be at risk. That's not a reason to avoid using equity, but it is a reason to go in with a clear plan.
When values fall, equity shrinks too. Brisbane values are currently 2.7% below their May peak, so some homeowners have a little less equity than they did a few months ago. We cover the latest figures in our September market update.
How much this matters depends on when you bought and how much you borrowed. If you've owned your home for several years, you're likely to still have plenty of equity, even after the recent dip.
Recent buyers with smaller deposits have less of a buffer. For example, if you bought an $800,000 home with a 5% deposit, you'd owe around $760,000. If values fell 6%, the home would be worth about $752,000 – a little less than the loan. That's called negative equity.
Negative equity isn't a problem in itself if you keep up your repayments and don't need to sell or refinance. It can, however, limit your options for a while, which is why it's worth knowing where you stand.
If you're wondering how much equity you might have, we're happy to help you find out. We can give you an estimate of your home's current value and your usable equity, then talk through what you'd like to achieve.
If you decide to go ahead, the lender will usually arrange its own valuation, which can differ from online estimates. From there, we'll compare options across more than 45 lenders and walk you through the paperwork. Under the Best Interests Duty, we're required to recommend what suits your circumstances – including telling you if accessing equity isn't the right move right now.
This article contains general information only and does not take into account your objectives, financial situation or needs. It is not tax, legal or financial advice. Using equity increases your debt, and your home is used as security for the loan. Speak with your accountant or a licensed financial adviser about tax and investment decisions. Examples are illustrative only, and interest rates used in them are assumptions rather than rates on offer. Market figures are point-in-time and change monthly. Information current as at 16/09/2026.
'We', 'us' and 'our' refer to McIntyre Finance (Credit Representative number 519302 is authorised under Australian Credit Licence Number 389328) and our related businesses. Connective Credit Services Pty Ltd, Level 29, 555 Collins Street, Melbourne VIC 3000. Phone 1300 656 637. Complaints: complaints@connective.com.au
.png)
.png)