How to Calculate Appreciation

Step 1

Divide the final value of the investment from the initial value of the investment

Divide the final value of the investment from the initial value of the investment. For example, if you purchased your home for $200,000 and five years later the value equals $230,000, you would divide $230,000 by $200,000 to get 1.15.

Raise the result to the 1/Tth power

Step 2

Raise the result from Step 1 to the 1/Tth power, with T being the time in years the appreciation took place over. Continuing the example, you would raise 1.15 to the 1/5 power to get 1.028346722.

Subract 1 from the result in Step 2

Step 3

Subtract 1 from the result in Step 2. Furthering the example, you would subtract 1 from 1.028346722 to get 0.028346722.

Multiply the result from Step 3 by 100

Step 4

Multiply the result from Step 3 by 100 to find the annual appreciation rate. Concluding the example, you would multiply 0.028346722 to find the annual appreciation rate on the property to be about 2.83 percent per year.