How to use this calculator
- Enter or choose properties (one per line: value, loan, annual net income).
- The total equity updates as you type. Use Copy result or Share to keep it.
Method
Equity = Value − Loan; Share of value = Value ÷ Σ Value; Share of equity = Equity ÷ Σ Equity; LTV = Loan ÷ Value; Return on equity = Net income ÷ Equity; Portfolio LTV = Σ Loan ÷ Σ Value
- Net income
- annual cash flow after all running costs and loan payments
- Equity
- the part of the value you own outright
Worked example
- Total value = 300,000 + 500,000 + 200,000 = $1,000,000; loans = $430,000.
- Equity = 1,000,000 − 430,000 = $570,000; LTV = 43%.
- Net income = $46,000, so return on equity = 46,000 ÷ 570,000 = 8.07%.
- House B is 500,000 ÷ 1,000,000 = 50% of the value.
The portfolio holds $570,000 of equity at a 43% LTV and earns 8.07% on that equity; House B is half the value.
What the result means
Look for holdings with a large share of equity but a low return on equity: refinancing or selling those can free capital. A high share in one property or location is concentration risk.
Assumptions and limits
- Values are your current estimates and loans are outstanding balances.
- Net income is after running costs and loan payments.
- Ignores capital growth, tax and transaction costs, which a full return measure would include.
- A property with zero or negative equity shows no return on equity.
Questions
Why look at equity share as well as value share?
Value shows exposure to price moves; equity shows where your own money is tied up. A heavily mortgaged property can be a big share of value but a small share of equity.
What is a good portfolio LTV?
There is no single answer; lower LTV means more resilience to falling prices or rising rates, higher LTV means more leverage. Lenders often look at the portfolio as a whole for further borrowing.
Please note: Returns are illustrations at a constant rate, not predictions or guarantees. Investments can lose value. This is not investment advice.