Investment Property Calculator
Use this calculator to model an Australian investment property and determine:
- The cash cost each year before tax
- The after-tax cost each year
- The net gain after tax and debt when the property is sold in a chosen year
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Your assumptions
Property details
Property income
Mortgage details
Ongoing expenses
Tax settings
Tax estimates include a flat 2% Medicare levy.
Cashflow breakdown by year
| Line item | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|---|---|---|---|---|---|---|---|---|---|
Rental income (including vacancy) | $34,580 | $35,445 | $36,331 | $37,239 | $38,170 | $39,124 | $40,102 | $41,105 | $42,132 | $43,186 |
Property management fees | -$2,421 | -$2,481 | -$2,543 | -$2,607 | -$2,672 | -$2,739 | -$2,807 | -$2,877 | -$2,949 | -$3,023 |
Other property expenses | -$5,500 | -$5,637 | -$5,778 | -$5,923 | -$6,071 | -$6,223 | -$6,378 | -$6,538 | -$6,701 | -$6,869 |
Loan interest | -$38,186 | -$37,701 | -$37,187 | -$36,640 | -$36,060 | -$35,444 | -$34,791 | -$34,096 | -$33,359 | -$32,577 |
Loan principal | -$7,859 | -$8,344 | -$8,859 | -$9,405 | -$9,985 | -$10,601 | -$11,255 | -$11,949 | -$12,686 | -$13,468 |
Total cash expenses | -$53,966 | -$54,164 | -$54,367 | -$54,575 | -$54,788 | -$55,007 | -$55,231 | -$55,461 | -$55,696 | -$55,937 |
Net cash cost | -$19,386 | -$18,720 | -$18,036 | -$17,336 | -$16,618 | -$15,883 | -$15,129 | -$14,356 | -$13,564 | -$12,752 |
Building depreciation (non-cash expense) | -$10,000 | -$10,000 | -$10,000 | -$10,000 | -$10,000 | -$10,000 | -$10,000 | -$10,000 | -$10,000 | -$10,000 |
Taxable gain or loss | -$21,527 | -$20,376 | -$19,178 | -$17,931 | -$16,633 | -$15,282 | -$13,874 | -$12,407 | -$10,878 | -$9,283 |
Tax refund / tax payable | $6,889 | $6,520 | $6,137 | $5,738 | $5,323 | $4,890 | $4,440 | $3,970 | $3,481 | $2,971 |
After-tax cashflow | -$12,498 | -$12,199 | -$11,900 | -$11,598 | -$11,296 | -$10,993 | -$10,689 | -$10,386 | -$10,083 | -$9,781 |
Sale summary at end of holding period
| Sale price | $1,075,133 |
| Selling costs | -$26,878 |
| Net sale before loan & tax | $1,048,255 |
| Loan payout at sale | -$535,589 |
| Capital gain | $308,255 |
| Capital gains tax payable | -$64,397 |
| Net sale after loan & tax | $448,269 |
| Cumulative after-tax cashflow | -$111,422 |
| Initial cash outlay Deposit + purchase costs | $200,000 |
| Overall net gain | $136,847 |
Overall net gain over time
Property value and loan balance over time
| Year | Property value | Opening loan | Closing loan | Equity |
|---|---|---|---|---|
| 1 | $824,000 | -$640,000 | -$632,141 | $191,859 |
| 2 | $848,720 | -$632,141 | -$623,797 | $224,923 |
| 3 | $874,182 | -$623,797 | -$614,938 | $259,244 |
| 4 | $900,407 | -$614,938 | -$605,533 | $294,874 |
| 5 | $927,419 | -$605,533 | -$595,548 | $331,871 |
| 6 | $955,242 | -$595,548 | -$584,947 | $370,295 |
| 7 | $983,899 | -$584,947 | -$573,692 | $410,207 |
| 8 | $1,013,416 | -$573,692 | -$561,743 | $451,673 |
| 9 | $1,043,819 | -$561,743 | -$549,057 | $494,761 |
| 10 | $1,075,133 | -$549,057 | -$535,589 | $539,544 |
After-tax cashflow per year
How this calculator works
- Depreciation and CGT: Building value is depreciated straight-line over 40 years. Depreciation is treated as a deduction for rental income but also reduces your CGT cost base (purchase price plus purchase costs minus total depreciation), which can increase the capital gain on sale.
- Loan structure: You can model either principal & interest for the full term, or five years of interest-only repayments followed by principal & interest over the remaining term.
- Capital gains tax on sale: Includes 50% CGT discount for holding periods greater than 1 year. The CGT estimate is based on the extra tax payable when the discounted gain is added to your other income in the sale year.
- Net gain on sale: The net gain figure adds up all after-tax cashflows, adds the net sale proceeds after loan repayment and CGT, then subtracts your initial cash outlay (deposit plus purchase costs).
- Limitations: Interest rates, growth and tax rules are assumed to be constant and simplified.
This calculator is general information only. It does not take into account your objectives, financial situation or needs and is not tax or financial advice.