What's a good amount of home equity to have right now?

As home prices have surged over the past several years, so too has the amount of equity homeowners are sitting on. As a result, home equity — the difference between your home's market value and the amount you still owe on your mortgage — has become a key component of household wealth in the U.S. And, with the interest rate environment remaining elevated and higher-than-optimal inflation continuing to impact household budgets, more homeowners are keeping a close eye on their home equity to assess their financial standing and determine whether it's worth borrowing against. 

But what exactly qualifies as a "good" amount of home equity in today's market? While there's no single number that works for every homeowner, there are important benchmarks that can help you understand where you stand — and how much equity you might want to preserve. Below, we'll take a closer look at the total amount of equity homeowners have today, how much individual homeowners have and how much you should ideally hold onto, whether you want to tap into your home equity to pay off debt, fund home renovations or build an emergency cushion.

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What's a good amount of home equity to have right now?

Here's what the latest data reveals about today's home equity levels and what would be considered a good amount of home equity right now:

What is the total amount of equity homeowners have nationwide?

Homeowners collectively hold nearly $35 trillion in home equity currently, according to the latest data from the Federal Reserve Bank of St. Louis. While that figure marks a slight drop from the recent peak of $35.5 trillion, which was recorded in the second quarter of 2024, it's still a major leap compared to previous years. For example, the total amount of home equity nationwide was closer to $20 trillion at the start of 2020, meaning that homeowners have seen a roughly 75% increase in equity wealth over just a five-year span.

This rise is largely attributed to the rapid home price appreciation fueled by tight housing inventory, strong demand and low mortgage rates spurred by the pandemic in the early 2020s. But even as price growth has cooled somewhat and mortgage rates have risen, homeowners have continued to hold onto a significant amount of their gained equity.

And, compared to historical norms, today's equity levels are unusually high. For perspective, at the start of 2012 — around the time of the housing market recovery from the Great Recession — the total amount of home equity across U.S. households was just over $8 trillion. That means current levels are more than four times higher than they were just over a decade ago.

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How much home equity does the average homeowner have right now?

On an individual level, the average homeowner currently has about $313,000 in home equity, according to the latest ICE Mortgage Monitor Report. Of that $313,000, roughly $203,000 is considered tappable equity, meaning that you could potentially borrow against it without dropping your remaining equity below the threshold that home equity lenders typically require.

That figure represents a modest decline from the $319,000 home equity average that was reported in late 2024, which is likely due to a slight dip in home prices in certain regions. Still, home equity remains up by about 6% overall year-over-year, indicating that the majority of homeowners have continued to build wealth through homeownership, even amid the shifting housing market landscape. That means most homeowners are in a solid position to leverage their home's value — if they do so wisely.

How much home equity should I keep if I borrow against it?

If you're thinking about tapping into your home equity, it's important to understand how much you should aim to keep untouched. Most lenders require homeowners to maintain at least 20% equity in their home after borrowing. That means you can generally borrow up to 80% of your home's appraised value, including your existing mortgage balance.

For example, if your home is worth $500,000, you could borrow up to $400,000 across all loans that are secured by the property. So, if you already owe $300,000 on your mortgage, your maximum home equity loan or home equity line of credit (HELOC) would typically be $100,000.

However, just because you can borrow up to that limit doesn't mean you should. Many experts often recommend keeping a buffer of at least 25% equity in your home, particularly in uncertain economic times. That cushion can help protect you from falling into negative equity if home values drop, and it also preserves borrowing power in the future if unexpected expenses arise.

The bottom line

Home equity remains one of the most valuable financial tools available to homeowners, and having a solid amount of equity can boost your overall financial security. Right now, the average homeowner has over $300,000 in equity — more than enough to provide flexibility for emergencies, investments or major expenses.

If you're thinking about tapping into that equity, just make sure you leave yourself a sufficient cushion. Aim to keep at least 20% equity in your home — and ideally more — so that you stay financially protected no matter how the housing market evolves. Whether you use a HELOC, home equity loan or cash-out refinance, using your home equity strategically can help you get more out of your biggest asset.