Most Australians who reach $100,000 in equity do the same thing: nothing. They note it with quiet satisfaction, maybe mention it at a dinner party, and then carry on with their mortgage as if the number isn’t sitting there.
That’s not a criticism — ‘doing nothing’ sometimes genuinely is the right call. But it should be a deliberate choice, not a default. Because doing nothing with $100,000 in equity also has a cost.
First: understand what you actually have access to
Equity is the gap between what your property is worth and what you owe. But lenders will typically only allow you to borrow up to 80% of your property’s value. So ‘usable equity’ is the difference between 80% of the current value and your outstanding loan balance.
If your home is worth $800,000 and your loan balance is $600,000: 80% of $800,000 is $640,000. Minus $600,000 owed — that’s $40,000 in usable equity. Not $200,000. The distinction matters before you make any plans.
Option 1: Leave it, reducing your interest — and know that’s a real strategy
Equity sitting in an offset account or redraw facility is working for you every single day. Every dollar offsets interest on your loan. It’s a guaranteed, tax-free return equal to your mortgage rate. For anyone not ready to take on more risk or complexity, this is a legitimate choice — not inaction.
Option 2: Renovate strategically
Using equity to improve the property can make sense when the work adds more value than it costs. Kitchen and bathroom upgrades, an extra bedroom, or energy efficiency improvements tend to deliver in Australian conditions. The keyword is ‘strategically’ — renovating emotionally tends to cost more and return less.
Option 3: Use it as a deposit for an investment property
This is where $100,000 in equity becomes genuinely interesting. If your usable equity is sufficient, it can potentially serve as the deposit on an investment property — without needing to save a separate cash deposit. See Q6 for how this works in detail.
Option 4: Consolidate higher-interest debt
Rolling personal loans or credit card debt into a mortgage sounds attractive because the interest rate is lower. But it extends short-term debt over 25–30 years. Even at a lower rate, the total interest paid can be significantly higher. This one requires careful calculation before acting — not just a comparison of rates.
The question worth asking before you act
Can you comfortably service the increased debt if rates rose by 3%? Does this decision bring you closer to your financial goals — or does it feel like progress while actually adding complexity? Equity decisions that look simple on paper often have consequences that only show up later.
We help homeowners run the numbers honestly — not to sell them a more complex loan structure, but to work out whether acting now actually makes sense for their situation.
This is general information only and does not constitute financial advice. Using equity carries risk, including the possibility of losing your property if repayments cannot be met. Speak with a licensed mortgage broker and financial adviser before making any investment decisions. All loans are subject to lender approval.
Sources: RBA, Financial Stability Review 2024; APRA Quarterly Property Exposures 2024; CoreLogic Home Value Index 2025; ATO, Investment Property Tax Guidance.
