Purchase price
$200k$3m
Built on the post-May-2026 tax rules
Investment Property Calculator - what an existing dwelling actually returns
A year-by-year model of buying an established home to rent out: acquisition costs from the state duty scales, after-tax cash flow under the new quarantined-loss rules, CGT at sale. It returns the two numbers a purchase turns on - the weekly cost to hold and the price that meets your return target.
Below your hurdles - IRR vs 8% and holding cost vs $150/wk
10-year IRR, after tax
6.4%
NPV at 7%
−$15,015
costs $364/wk after tax in year 1
Maximum price at your 8% hurdle
$577,000
The price of $750,000 is $173,000 above what this rent supports at your hurdle. Year-one cash flow breaks even at $1,274/wk rent, against $650 assumed.
Measured against the hurdles you set, not a recommendation. Every figure below follows from the assumptions on the left.
Hold summary
Cash required
$180k
deposit + duty + costs
Gross yield
4.5%
$650/wk on price
Holding cost, yr 1
−$19k
$364/wk after tax
Break-even year
-
cash flow turns positive
Quarantined pool
$184k
peak - applied at sale
Equity at end
$720k
value less loan, yr 10
CGT at sale
$39k
split
Net sale proceeds
$650k
after loan and CGT
Net yield 2.2%LVR 80%Total return $235,812Sale value $1.22m
Quarantined loss pool
Rental losses from 1 July 2027 no longer offset your salary - they pool here until rental profits absorb them, or the sale applies them against the gain.
The cash the purchase consumes
| Deposit | 83% | $150,000 |
| Transfer duty | 15% | $26,775 |
| Conveyancing | 1% | $2,000 |
| Building and pest | 0% | $600 |
| Loan setup | 0% | $800 |
| Cash required at settlement | $180,175 | |
Sensitivity - after-tax IRR
Capital growth down the side, interest rate across the top. Shaded cells clear your 8% hurdle.
| Growth / rate | 4.0% | 5.0% | 6.0% | 7.0% | 8.0% |
|---|---|---|---|---|---|
| 3.0% | 5.7% | 3.9% | 2.1% | 0.3% | -1.6% |
| 4.0% | 7.1% | 6.0% | 4.8% | 3.1% | 1.4% |
| 5.0% | 8.4% | 7.4% | 6.4% | 5.3% | 4.1% |
| 6.0% | 9.7% | 8.7% | 7.7% | 6.7% | 5.7% |
| 7.0% | 10.9% | 9.9% | 9.0% | 8.0% | 7.1% |
Year by year
| Yr | FY | Rent | Expenses | Interest | Principal | Deprec. | Tax effect | After tax | Cumulative | Equity | Loss pool |
|---|---|---|---|---|---|---|---|---|---|---|---|
| 1 | 2027 | $32,500 | $16,810 | $35,740 | $7,382 | $6,563 | $8,516 | −$18,916 | −$199,091 | $195k | - |
| 2 | 2028 | $33,475 | $17,140 | $35,285 | $7,836 | $6,563 | $0 | −$26,787 | −$225,877 | $242k | $25,513 |
| 3 | 2029 | $34,479 | $17,481 | $34,803 | $8,319 | $6,563 | $0 | −$26,123 | −$252,000 | $292k | $49,879 |
| 4 | 2030 | $35,514 | $17,831 | $34,290 | $8,831 | $6,563 | $0 | −$25,439 | −$277,438 | $344k | $73,049 |
| 5 | 2031 | $36,579 | $18,192 | $33,747 | $9,375 | $6,563 | $0 | −$24,734 | −$302,173 | $399k | $94,971 |
| 6 | 2032 | $37,676 | $18,564 | $33,169 | $9,952 | $6,563 | $0 | −$24,009 | −$326,181 | $457k | $115,590 |
| 7 | 2033 | $38,807 | $18,947 | $32,557 | $10,565 | $6,563 | $0 | −$23,261 | −$349,442 | $518k | $134,849 |
| 8 | 2034 | $39,971 | $19,341 | $31,906 | $11,215 | $6,563 | $0 | −$22,491 | −$371,934 | $582k | $152,687 |
| 9 | 2035 | $41,170 | $19,747 | $31,216 | $11,906 | $6,563 | $0 | −$21,698 | −$393,632 | $649k | $169,043 |
| 10 | 2036 | $42,405 | $20,166 | $30,482 | $12,639 | $6,563 | $0 | −$20,882 | −$414,514 | $720k | $183,848 |
Tax effect is the refund (+) or extra tax (−) the property creates that year, including quarantining from FY2028 for post-cutoff purchases. Maintenance and the letting fee are estimated where not entered.
This page models the property. The full audit adds the buy-box verdict, the three acquisition classes side by side, and the red flags.
Deal Auditor - in build, not yet available
An existing dwelling is now a different asset to the one your parents bought
Since 7:30pm on 12 May 2026, an established home bought as a rental belongs to a quarantined class: from 1 July 2027 its losses stop reducing the tax on your salary. The cash flow question retail investors have always asked - what does this cost me a week? - now has a different answer for the same property at the same price, because the refund that used to soften a negatively geared year arrives years later, or only at sale. This calculator prices that delay year by year rather than pretending the old rules still apply.
The two numbers worth negotiating from are the ones in the verdict panel. The maximum price holds your rent and assumptions still and asks what price delivers the return you demanded - the residual-value logic developers use, pointed at a house. The break-even rent asks the same question of the income side. Between them sits the weekly holding cost, which is what you will actually feel. If a deal only works with the growth assumption raised or the vacancy set to zero, the sensitivity grid will say so.
Whether losses are quarantined turns on when the contract was signed - check Am I Grandfathered? if the date is close. To see the quarantine mechanics on their own, use the negative gearing calculator; to compare against a brand-new dwelling that keeps its deductions, see new build vs established. Developing the site instead of holding it? Run the development feasibility calculator.
Frequently asked questions
How do the May 2026 negative gearing changes affect an existing dwelling?
A contract signed after 7:30pm AEST on 12 May 2026 for an established dwelling falls into the quarantined class: from 1 July 2027 its rental losses no longer reduce salary income. They accumulate in a loss pool that offsets other residential rental income, future rental profits from the same property, or the capital gain at sale. Contracts signed before the cutoff are grandfathered and keep full negative gearing. This calculator models the pool year by year, shows when it is absorbed, and applies it at sale if it never is.
What discount rate should I use for the NPV?
The NPV discounts your after-tax cash position: cash in at settlement, the yearly surplus or shortfall, and the net sale proceeds. A common manual choice is the return your money would earn elsewhere at similar risk. The WACC option builds the rate from the deal itself: the loan portion at your borrowing rate and your cash portion at the return you require on it, weighted by the dollars each side commits. Strictly, cash flows measured after loan payments pair with a required equity return; the WACC basis is offered as a transparent, funding-weighted assumption.
What does the after-tax holding cost per week mean?
It is what the property adds to or takes from your pocket each week in the first year, once rent, vacancy, management, rates, water, insurance, body corporate, maintenance, loan payments and the tax outcome are all counted. For a quarantined-class purchase the tax refund most investors expect does not arrive from July 2027, which is why the same dwelling can cost more per week to hold than it did under the old rules.
How is capital gains tax calculated at sale?
By acquisition class. A grandfathered holding keeps the 50% discount on the whole gain. A quarantined-class established dwelling splits the gain at the deemed 1 July 2027 reset: the earlier slice keeps the old discount treatment and the later slice is CPI-indexed and subject to the 30% minimum tax rules. Any unabsorbed loss pool is applied against the gain first, and capital works deductions claimed along the way reduce the cost base. The calculator does this arithmetic and shows the method used.
Is the maximum price a recommendation?
No. It is the purchase price at which this rent, these costs and these growth assumptions deliver exactly the IRR target you set - solved by re-running the full projection at different prices. Change the target or any assumption and the number moves. It tells you what the deal is worth against your own criteria, not whether to buy it.
This model covers one established residential dwelling held for rent by an individual owner. Land tax uses the selected state's individual or general scale on the property's estimated land value (the NT levies no land tax); maintenance, letting fees and depreciation are estimated where no figure is entered; transfer duty uses the general investor scale for the state selected. It does not model trusts or companies, granny flats or dual occupancy, rooming arrangements, or short-stay letting. General information only.