Equity grows as your percentage of home ownership grows. This happens in a variety of ways. One way to build your equity is by paying down your mortgage. Some homeowners choose to pay more than their monthly minimums which ends up saving them thousands of dollars in interest down the line. Another way to create equity in your home is by adding value in the form of home and property improvements. Lastly, equity in your home can be creating passively in a strong market with rising price appreciation. Homeownership creates equity in a way that renting can not.