Lenders typically limit total debt repayments to 35–40% of gross income (debt-to-income ratio). They also assess living expenses, dependants, credit score and employment stability. This calculator uses a simplified DTI model — actual lending decisions vary by lender.

Buying costs: Mortgage repayments, council rates (~0.3%), maintenance (~1% p.a.), insurance, strata (if applicable), minus equity gained
Renting costs: Rent paid over 5 years, renters insurance
Opportunity cost: Return you could have earned investing your deposit instead

FHOG amounts (new builds, 2024): NSW $10,000 · VIC $10,000 · QLD $30,000 · WA $10,000 · SA $15,000 · TAS $30,000 · ACT nil · NT $10,000
Most states also offer stamp duty concessions or exemptions for first home buyers below price thresholds.

AU refinancing costs: Discharge fee ($150–$400) · New application/establishment fee ($0–$700) · Legal/conveyancing ($300–$800) · Break cost (variable rate: nil; fixed rate: can be significant)
If on a fixed rate, check your break cost with your lender before proceeding — it can run to thousands.

Gross yield = (Annual rent ÷ Property value) × 100. Simple but ignores costs.
Net yield = ((Annual rent − All annual costs) ÷ Property value) × 100. This is what you actually earn.
A property with 5% gross yield might only return 3–3.5% net after costs. Target 4%+ net in AU for positive cash flow (depending on leverage).

Total return includes capital growth + net rental income. This is the full picture.
Cash-on-cash return = annual after-cost rent ÷ cash invested (your deposit + costs). This measures the return on your actual cash outlay — useful when comparing leveraged vs unleveraged investments.

A property is negatively geared when rental income is less than deductible expenses (interest, rates, insurance, management, depreciation). The shortfall reduces your taxable income, saving you tax at your marginal rate.
Example: $10,000 shortfall at 37% marginal rate = $3,700 tax saving per year. Your actual out-of-pocket is $6,300.
Important: The strategy only profits overall if capital growth exceeds the ongoing cash shortfall. It is not a guaranteed strategy.

Positive cash flow: Rent exceeds all costs — the property pays for itself and puts money in your pocket each month.
Negative cash flow: Costs exceed rent — you top up the shortfall from your own income. You may claim the shortfall as a tax deduction (negative gearing).
Most Australian investment properties are negatively geared, relying on capital growth for total return.

50% CGT discount: If you've owned the property for more than 12 months, only 50% of the capital gain is added to your taxable income.
Main residence exemption: Your primary home is generally exempt from CGT entirely. This calculator is for investment properties.
Cost base includes purchase price + stamp duty + legal fees + capital improvements.

Land tax applies to investment and holiday properties — not your primary residence.
Thresholds (approx 2024): NSW $1.075M · VIC $300K (2024 threshold) · QLD $600K · WA $300K · SA $723K · TAS $25K · ACT (varies)
Rates are applied progressively above the threshold. Foreign owners face additional surcharges in most states.