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Investment property calculator

Want to understand the dollars and sense of property investing?

If you’ve ever considered an investment property and wondered how the numbers stack up, check out our Investment Property Purchase Calculator. 

This tool allows you to enter basic figures associated with property purchase, maintenance and holding fees – while delivering a raft of insightful information that might shed light on a prospective property’s potential. 

The calculator also factors in the state in which the property is located, and considers potential tax concessions and cash shortfalls. 

Opening up an array of scenarios, and conveniently quick and simple to use, this calculator puts handy information at the tip of your fingers.

Find out if an investment property is the best option for you

By launching our Investment Property Calculator, you acknowledge that you have read and understood the Terms of Use below and agree that you are bound by them.

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It is important to understand that this calculator provides possible outcomes based upon both the information provided by you and the assumptions used and that its results are for illustration and information purposes only. Results are not guaranteed in any way and do not constitute a forecast or estimation of amounts payable or available in the future.

While the calculator is a useful starting point, it cannot replace expert, licensed financial advice and should not be used as the basis for any financial decision. You should consider obtaining advice from a qualified financial adviser to assess your specific financial situation before making any financial decisions.

This calculator is based on the laws of Australia applying as at 1 July 2016.

The Investment Property Purchase Calculator assists you to determine the affordability of an investment property.  It combines factors such as rent, operating expenses and tax deductions to provide you with an estimate of the net amount you will receive for the investment property (the after tax profit) or the net amount you will pay for the property (the after tax loss).

What you should know

The results provided by this calculator are approximations only and are based on underlying assumptions set out below.  While the information you provide impacts the calculator’s results, the calculator cannot incorporate every factor that will influence the actual costs, income, tax concession/liability and ongoing cash flow/shortfall from purchasing an investment property.

StatePlus specifically disclaims any liability (whether based in contract, tort, strict liability or otherwise) for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with the access to or use of the Investment Property Calculator.

This calculator is issued by State Super Financial Services Australia Limited, trading as StatePlus, ABN 86 003 742 756, AFS Licence No. 238430 (SSFS).

Important information
  • the calculator permits you to select either interest only repayments or principal and interest repayments. If you select the interest only repayments, the calculator operates on the basis that interest only payments are made for the life of the loan. The calculator does not take into account the repayment of the principal at the end of the loan
  • the property’s Purchase Costs exclude any stamp duty, mortgage costs and transfer fees. Please input a single amount to cover the additional costs associated with purchasing a property; for example legal fees, property inspection fees, valuations and/or lenders mortgage insurance
  • the Ongoing Property Costs is the estimate of the total amount per year to cover the per annum non-mortgage ongoing costs associated with a property, for example insurance, rates, body corporate fees and/or management fees
  • the Expected Gross Rent pa is the estimate of the total annual gross rent for the property (excluding costs and expenses such as insurance, rates, body corporate fees and/or management fees)
  • the government stamp duty, and other government fees and charges are calculated based on an investment property (that is not vacant land) in the State or Territory, for the given state selected by the user. Different rates of duty and fees may apply for vacant land. You should contact State Revenue in your State or Territory for the correct rates

The following tables outline the stamp duties per State and Territory for investment properties. Stamp duty is calculated by taking the Property Value and State / Territory entered by the customer to return the given property value boundaries, fee, rate and increment. For example, a property in New South Wales with a value of $400,000 would return a fee of $8,990 and the extra rate of $4.50 per $100. This would then calculate the stamp duty as $8,990 plus $4.50 per $100 for the difference between the property value and $300,001.

Please note the assumptions are based on rates as at 1 July 2016

The calculator determines stamp duty by reference to the stamp duty paid on the purchase price of the investment property, the transfer fee and the mortgage registration fee only. This calculation assumes the user is not eligible for any additional rebates, for example a First Home Owner's Grant.
  • total Start Up Costs are calculated by adding up the addition of the government stamp duty, fees and charges and the Purchase Costs entered by the user. These costs are in addition to the user entered Initial Deposit amount
  • the Loan Repayments amount listed in the calculation of Ongoing Costs Per Year is calculated by deducting the entire Initial Deposit amount from the Property Value amount
  • potential Tax Concession is calculated from the difference in income tax payable based on the user's entered Expected Gross Rent pa reduced by the annual interest payable in relation to the loan and annual maintenance costs. If this value is negative, the label will be changed to Potential Tax Liability
  • the income tax payable used in the calculation of the Potential Tax Concession/Potential Tax Liability is calculated applying marginal tax rates to the net amount calculated above. No adjustment has been made for any other income tax based levies (for example HECS or Medicare Levy), and other income (eg salary) and tax deductions which may impact on marginal tax rates. As a result, your Potential Tax Concession/Potential Tax Liability may be higher or lower than estimated by the calculator
  • the calculator does not take into account any provision for depreciation entitlements in relation to the purchased property or any other tax deduction or liability the user may incur. Accordingly, your actual tax concessions arising from the investment property may be higher than estimated by the calculator. Alternatively, your actual tax liability may be lower than estimated by the calculator
  • the calculator does not enable a user to factor in any one-off payments in relation to the purchased property, such as for repairs
  • interest is calculated on the unpaid balance of the loan at the end of each period of repayment. The rate applied for each period is equal to the annual percentage rate divided by repayment periods within that year. The assumptions relating to repayment frequency are set out below
  • the loan repayments calculations do not take into account any fees and costs payable in relation to the loan eg annual fees or early repayment / exit fees
  • ongoing Cash Flow/Ongoing Cash Shortfall is calculated by the difference between the Rent Income Per Year and the total Ongoing Costs Per Year, adjusted for the Potential Tax Concession/Potential Tax Liability
  • the calculator assumes that the user will receive the same gross annual rent per year and will pay the same ongoing costs per year over the life of the loan. The calculator therefore assumes no change in rent, ongoing costs or interest rates over time
  • there has been no adjustment for inflation made within the calculations
 

Calculator Assumptions

Length of Month 

Months are assumed to be of equal length of 30 days. Accordingly, it is assumed that the interest charged per month remains constant. However, given some months are longer than others, the actual interest charged on a loan will vary depending upon the month and the convention used by the specific financial organisation providing the mortgage. Therefore the monthly repayment amount may vary by approximately 3%.

Number of Weeks & Fortnights in a Year 

One year is assumed to contain exactly 52 weeks or 26 fortnights. Thus each year is assumed to have 364 days.
 

Repayment frequency 

Repayments are assumed to be made on the last day of the month.

Rounding of Repayment Amounts 

Generally, financial institutions round repayments to the nearest cent. However, the calculator uses the entered unrounded periodic repayment amount to derive the amount of interest payable over the full term of the loan.
 

Total Interest Payable in Year 1 

It is assumed that a full year’s repayments have been made. It is the interest component from year 1 that is used in the Potential Tax Concession calculation.

Other assumptions 

  • ongoing property costs are assumed to be evenly spread throughout the year. This means that the ongoing property costs are the same for each month of Year 1
  • it is assumed that interest on the loan is deductible for income tax purposes
  • the property is assumed to be mortgaged and classes as an investment property
  • this calculator assumes that a loan is required to partially fund the purchase of the investment property
  • the income tax payable used in the calculation of the Potential Tax Concession/Potential Tax Liability is calculated using marginal tax rates only. No adjustment has been made for any other income tax based levies; for example HECS and Medicare Levy

If the Investment Property Purchase Calculator has inspired you with the idea of investing in property, then it may be time to get more professional advice.

Call us to book an appointment with your friendly financial planner on 1800 620 305, and build a solid path to wealth creation.