What is equity in a home?

Equity is the portion of a property's value that the owner actually owns free and clear — calculated as the current market value of the property minus any outstanding mortgage balance. When you first purchase a home with a mortgage, your equity equals your down payment. Over time, equity grows in two ways: as your mortgage balance decreases through regular payments, and as the property's market value increases.

Equity is one of the primary financial benefits of homeownership, and it has been a significant factor in the Western Catskills in recent years. Property values across Delaware, Ulster, Greene, and Otsego counties have appreciated substantially, particularly since 2020, as demand from buyers seeking rural retreats has driven prices higher. Homeowners who purchased in these counties even a few years ago may have seen meaningful equity gains. Equity can be accessed through a home equity loan or line of credit, and it forms the foundation of most sellers' financial return when they eventually sell.