Investment Property Calculator - Cash Deposit

1. Lender’s Mortgage Insurance (LMI)

LMI is estimated based on publicly available online data. Actual premiums vary by lender, insurer, loan structure, and deposit size. LMI is assumed to be paid out of the "initial savings to invest" meaning less cash deposit is available.

2. Land tax thresholds and rules

Land tax thresholds are assumed to remain unchanged over time. In recent years, thresholds have not been indexed and any future changes are at the discretion of state governments. The model does not attempt to predict future threshold, rate, or assessment rule changes.

3. Loan term and structure

A 30-year loan term is assumed, which is standard in Australia. The model assumes a consistent loan structure over the term and does not include interest-only periods unless this option is selected.

4. Personal tax rate

The investor’s marginal tax rate is assumed to remain constant throughout the investment period. Changes in income over time, tax bracket creep, or retirement-phase tax treatment are not modelled.

5. Property rent

Property rent is assumed to grow independent of property value.

6. Investment return consistency and sequence risk

The model assumes consistent annual growth and income rates. In reality, investment returns are volatile and the sequence of returns can materially impact outcomes. This sequence risk also applies to interest rates, inflation, rental growth, property expenses, and vacancies. These factors are simplified as stable annual values for modelling purposes.

7. Holding period and liquidity

The model assumes the investor is able to hold the investments for the full selected time period and does not require liquidation during market downturns or adverse conditions.

8. Transaction costs and capital gains tax

The main Australian investment calculator does not include property selling costs (such as agent fees and legal costs) or capital gains tax (CGT).

A separate Selling Analyser illustrates the potential impact of selling costs and CGT. Users can input an assumed marginal tax rate at the time of sale, apply the 50% CGT discount where eligible, and specify property selling costs such as agent commission.

The Selling Analyser also allows for other common costs and adjustments, including property purchase costs, potential renovation costs, and property depreciation, to estimate their effect on the capital gain and after-tax outcome.

These inputs are estimates only. Actual capital gains tax outcomes depend on an individual’s total taxable income, applicable tax laws, and eligibility for concessions in the year the asset is sold, all of which are uncertain and may change over time. A sale may also move an investor into a higher tax bracket, materially affecting the tax payable.

Accordingly, results shown in the Selling Analyser are illustrative only and are intended to help users understand the sensitivity of outcomes to different tax and selling cost assumptions, rather than to predict actual tax liabilities.

9. Inflation treatment

All figures are presented in nominal terms unless otherwise stated. Returns are not adjusted for inflation unless explicitly selected.

10. Behavioural assumptions

The model assumes disciplined investing behaviour. Cash contributions continue during market downturns and are not altered in response to short-term market movements.

11. Regulatory and policy stability

The model assumes no major changes to taxation, lending rules, housing policy, or investment regulations that would materially alter outcomes. Future policy changes cannot be reliably predicted and are not modelled.

Disclaimer

This calculator is provided for general information and educational purposes only. It does not constitute financial, investment, tax, or legal advice and does not take into account your objectives, financial situation, or needs.

The results are based on user inputs and modelling assumptions and are illustrative only. Actual outcomes may differ materially due to changes in markets, interest rates, taxation, legislation, and individual circumstances. Past performance and modelled returns are not a reliable indicator of future performance. You should not rely on this calculator as the sole basis for making financial decisions.

This calculator is intended to assist users in understanding potential investment outcomes and trade-offs. It does not recommend any specific investment strategy or asset class.

The creator of this calculator is not a licensed financial adviser and does not provide personal financial advice. Before making any investment or financial decision, you should consider your personal circumstances and seek independent advice from a qualified and licensed professional where appropriate.