# How to track home equity in your net worth > Calculate home equity from a supportable current home value minus every home-secured debt, then avoid counting the result twice. - Canonical URL: https://www.worthi.app/guides/how-to-track-home-equity - Author: Vlad Poncea - Published: July 15, 2026 - Last reviewed: July 15, 2026 ## Short answer Home equity equals the home's current value minus the outstanding balance of the mortgage and any other debt secured by the home. In a complete net worth statement, record either the full home value plus those debts separately, or record equity alone. Never use both methods at once. ## Formula Home equity = current home value − total home-secured debt. The Consumer Financial Protection Bureau defines equity as what a property is currently worth minus the amount of an existing mortgage. A complete personal balance sheet should also subtract outstanding HELOCs, home-equity loans, and other liens or debt secured by the property. ## Worked example Suppose a home has a supportable current value of USD 500,000. The first mortgage balance is USD 310,000 and the outstanding HELOC balance is USD 20,000. Total home-secured debt is USD 330,000, so estimated home equity is USD 170,000. Subtract only the HELOC outstanding balance, not its credit limit. ## Use current value, not purchase price forever Purchase price and down payment describe the original transaction. Current equity changes as property value moves, principal is repaid, new secured debt is added, or debt is paid off. Use an estimate appropriate to the purpose and date. A conservative personal tracking estimate may be adequate for a net worth snapshot. Lending, tax, insurance, legal, or sale decisions may require a different standard or professional appraisal. ## Estimate from relevant evidence Recent comparable sales, a local real-estate professional, and a qualified appraisal can provide stronger property-specific evidence than a broad index. Consider location, size, condition, improvements, restrictions, and the date of each comparable. The Federal Housing Finance Agency says its House Price Calculator applies average area appreciation and does not project the actual value of a particular home. Automated and index estimates are reference points, not statements of fact. ## Use current principal balances Use each balance owed on the calculation date, not the original loan amount and not all future scheduled payments with interest. Include the first mortgage, second mortgage, outstanding HELOC, home-equity loan, and other property liens or secured balances that belong in the statement. ## Avoid double counting Method one records the full current home value as an asset and every secured balance as a liability. Method two records home equity alone. Both can produce the same net effect when ownership and debt scope match. Do not record full home value, subtract the mortgage in total liabilities, and then add home equity as another asset. In worthi, the clearer auditable method is normally the full real-estate asset plus separate loan balances. ## Match ownership and liability scope A household statement may include the whole jointly owned home and all household debt. An individual statement may use the ownership share relevant to that person. Apply the scope consistently. A partial asset and full mortgage can misstate the position unless the statement intentionally shows the person's full legal exposure. ## Allow negative equity Equity is negative when total home-secured debt exceeds the supportable current property value. Do not force the result to zero. A valuation range may be more honest in an uncertain market; preserve the method and date. ## Keep gross equity and sale proceeds separate The simple formula does not automatically subtract agent fees, taxes, repairs, concessions, moving costs, or other transaction expenses. Keep home equity as the balance-sheet measure and create a separately labeled estimated-net-proceeds scenario when a potential sale is the question. ## Update debt and value on appropriate schedules Mortgage and HELOC balances can be refreshed monthly from statements. A credible new home value may only be available quarterly, annually, or after a purchase, appraisal, renovation, damage, refinance, or local market shift. Preserve both dates and avoid presenting ordinary index movement as a precise property-specific change. ## Home equity is not cash Accessing owner-occupied home equity generally requires a sale or borrowing secured by the home. Both can involve cost, delay, qualification requirements, and risk. Keep total net worth, liquid net worth, emergency savings, and estimated sale proceeds as distinct measures. ## Important limitation This guide provides general educational information, not individualized financial, lending, investment, tax, legal, valuation, or real-estate advice. Property value, secured obligations, ownership rights, and transaction costs can require professional review. ## Sources - [What is a home equity loan?](https://www.consumerfinance.gov/ask-cfpb/what-is-a-home-equity-loan-en-106/), Consumer Financial Protection Bureau. - [HPI Calculator methodology and limitation](https://www.fhfa.gov/hpi-calculator), Federal Housing Finance Agency. - [Figure Out Your Finances](https://www.investor.gov/introduction-investing/investing-basics/save-and-invest/figure-out-your-finances), Investor.gov, U.S. Securities and Exchange Commission. - [Financial Accounts of the United States: recent developments](https://www.federalreserve.gov/releases/z1/current/recent_developments.htm), Board of Governors of the Federal Reserve System. ## Related documentation - [Real-world asset tracking in worthi](https://www.worthi.app/features/real-world-asset-tracking/index.html.md) - [How to track other assets in net worth](https://www.worthi.app/guides/how-to-track-assets-in-net-worth/index.html.md) - [What to include in net worth](https://www.worthi.app/guides/what-to-include-in-net-worth/index.html.md) - [Free net worth calculator](https://www.worthi.app/tools/net-worth-calculator/index.html.md) - [Complete worthi net worth tracker](https://www.worthi.app/net-worth-tracker/index.html.md)