How to use the Home Appreciation Calculator
Enter today’s value, an annual appreciation rate and how many years ahead to look. Add what you paid and how long you have owned the home to see its actual yearly appreciation so far.
How appreciation compounds
Appreciation builds on itself. A 400,000 home growing 4% a year gains 16,000 in the first year but about 22,000 in the tenth, so over 10 years it rises by roughly 48%, not 40%. Small changes in the rate make a large difference over long periods.
Choosing a rate
Use the actual rate your home has achieved, which the calculator works out from your purchase price and years owned, or look up your area in a house price index such as the FHFA House Price Index. Running a low, middle and high rate gives a more honest range than a single number.
Value is not the same as profit
A higher value is not money in hand. When you sell, agent fees, closing costs and any taxes come out of the gain, and the money you spent on improvements was part of what produced it.
The formula
Future value = current value × (1 + annual rate)^years. Past annual appreciation = (current value ÷ purchase price)^(1 ÷ years owned) − 1.
Examples
- With the default values
Projected value in 10 years: 592,097.71 Change: 192,097.71 (48.02%) Appreciation since purchase: 80,000 (25%) Actual annual appreciation so far: 4.56%
- With current home value set to 800000
Projected value in 10 years: 1,184,195.43 Change: 384,195.43 (48.02%) Appreciation since purchase: 480,000 (150%) Actual annual appreciation so far: 20.11%
Limitations and assumptions
Home prices do not rise at a steady rate. A projection is a scenario, not a forecast; local market, condition and interest rates move values more than any national average.
Frequently asked questions
How do you calculate home appreciation?
Future value = current value × (1 + annual rate)^years. To find the rate your home has achieved, divide today’s value by the purchase price, raise it to the power of 1 ÷ years owned and subtract 1.
What is the average home appreciation rate?
It varies a lot by place and period. Over long periods US home prices have risen a few percent a year on average, but individual years and local markets have ranged from sharp falls to double-digit gains.
Can I enter a negative rate?
Yes. Enter a negative percentage to see what happens if prices fall, down to −50% a year.