For many people, the equity they've built (or are building) in their home is a significant portion of their overall savings/investments — modeling it, however, can be tricky.
When you add a new 'Home Equity' item from the Accounts & Taxes tab, the Item Properties window will automatically appear, as shown below:
After entering the values above, click 'OK' to calculate your equity over time. Principal accrues based on a standard amortization schedule, and you can see those values in the Defined Contributions column on the account's output data.
NOTE: The checkbox Receives Unfunded Contributions is always set to true for Home Equity items. This means there is no corresponding decrease from Income or from other Accounts as the Home Equity item grows. Be sure you have a corresponding loan / mortgage payment as an EXPENSE including any extra-payments you designate.
If you paid a significant down payment or if this is a re-finance, then you have equity at the start of the loan. To model the value of this equity, enter the amount as the Starting Balance for the item. Note: This is equity that exists in the first year of the loan only, regardless if the loan was begun in the past (which can be set using the "Start on Year" field, as discussed above).
While the Interest Rate field determines the accrual of principal over the lifetime of the loan, the % Growth of the Home Equity item determines the rate of increase in the value of your home (it is defaulted to 3.5%). Each year's ending balance for a Home Equity item is based on both the growth in value of your home along with the accrual of principal.
OnTrajectory allows you to model extra-payments made to your loan. Designate the Annual amount of those payments as Contributions to the account. It's important to note that these contributions, like the equity you are building, are not deducted from your Income. YOU MUST ADD THEM AS EXPENSE FOR THEM TO BE DEDUCTED FROM YOUR INCOME.
By default, the End Age of the Home Equity item is set to 30 years from the Start Age. The reason it is not set by the Number of Years field in the Loan Information section is to allow you to set a sale year independent of the term of the loan (either to sell the home before the loan is paid off, or perhaps some years after). In addition, OnTrajectory automatically calculates your tax-free gains based on the 'Single / Married' option located in Settings on the Basic Settings tab, as shown below: