Methodology & rate sources

Calculation rules

Amounts are calculated in integer cents and formatted for display. Rule IDs identify the source definitions used by the project’s tests. These definitions describe the implemented model, including the limitations above.

BR-ACQ-01

Total acquisition cost = purchase price + transfer duty + registration/transfer fees + legal & conveyancing + building & pest + buyer's agent fee + LMI + loan establishment fees + other.

BR-ACQ-02

Total cash required = total acquisition cost − loan amount, floored at zero. This is the figure the buyer must produce at settlement.

BR-ACQ-03

Deposit = purchase price − loan amount. Deliberately distinct from BR-ACQ-02: the deposit is the equity in the asset, the cash required also covers duty and fees. Understating the gap between them is the most common reason a first purchase falls over, so both are shown.

BR-ACQ-04

LVR = loan amount ÷ purchase price. Against price, not total cost, because that is what lenders assess.

BR-ACQ-05

Acquisition costs are assumed funded in cash, not borrowed. If a user borrows for duty they can raise the loan amount; the engine does not infer it.

BR-ACQ-06

Transfer duty is computed from the jurisdiction's verified rate table (§6). All other acquisition costs are user-entered.

BR-INC-01

Gross annual rent = weekly asking rent × 52. No vacancy allowance.

BR-INC-02

Effective annual rent = weekly asking rent × (52 − vacancy weeks). This is rent actually collected.

BR-INC-03

Vacancy is entered in whole weeks per year, not a percentage. Agents and investors reason in weeks ("two weeks between tenants"), and a percentage implies precision the input does not have.

BR-INC-04

Other income (parking, storage, laundry) is entered as an annual figure and is not subject to the vacancy allowance.

BR-INC-05

Total effective income = effective annual rent + other income.

BR-INC-06

Rent is assumed level across the year. No mid-year rent review in MVP.

BR-EXP-01

Operating expenses comprise: council rates, water rates, strata administrative fund, strata sinking fund, landlord insurance, land tax, management fee, letting fee, repairs & maintenance, other.

BR-EXP-02

Finance costs are not operating expenses. They are excluded from operating expenses and from net operating income. See §5 and BR-YLD-05.

BR-EXP-03

Management fee = effective annual rent × management fee rate. Charged on rent collected, not asking rent — a vacant property generates no fee.

BR-EXP-04

Letting fee = weekly asking rent × letting fee weeks, charged once per year. This assumes one new tenancy per year, which is conservative for a stable tenancy and about right where vacancy is assumed. Stated rather than hidden, because it is an assumption a user may want to zero out.

BR-EXP-05

Strata is entered as two figures: administrative fund and sinking/capital works fund. Both are included in operating expenses because both are real cash outflows. The split exists because they diverge for tax (administrative generally deductible, sinking generally capital) — the MVP does not use that distinction, but capturing it now means the paid tier needs no data migration, and the user has both numbers on the strata report anyway.

BR-EXP-06

Land tax is user-entered, never computed. Land tax is assessed on the aggregate value of all land a person holds in a state, so it cannot be derived from a single property. Estimating it per-property would be wrong for anyone owning more than one — a large share of the audience.

BR-EXP-07

Expenses are assumed level across the year and paid in the year incurred. No accruals.

BR-EXP-08

Capital improvements are out of scope. Only recurring repairs & maintenance is an input.

BR-FIN-01

Repayments are computed with the standard annuity formula, monthly compounding at rate ÷ 12. This matches the scheduled repayment on Australian loan documents, which is the number a borrower can check, and is preferred over modelling daily accrual.

BR-FIN-02

Where an interest-only period applies, repayments during it are interest only and the balance does not reduce.

BR-FIN-03

After an interest-only period the loan amortises over the remaining term, not the original term. A 5-year IO period on a 30-year loan therefore raises the later repayment above the equivalent 30-year P&I figure.

BR-FIN-04

An offset balance reduces the interest-bearing balance but does not repay the loan. Interest is charged on (balance − offset); principal reduction still applies to the gross balance. The offset is assumed constant.

BR-FIN-05

Reported finance figures are year 1 only: interest paid, principal repaid, total repayments.

BR-FIN-06

Total annual repayments include principal. Principal is a cash outflow even though it is equity accumulation rather than a cost — see BR-CF-02.

BR-YLD-01

Gross yield on price = gross annual rent (BR-INC-01) ÷ purchase price. Uses asking rent with no vacancy allowance, because that is how listings and agents quote it. Deviating would make our figure look wrong beside every other source.

BR-YLD-02

Gross yield on total acquisition cost = gross annual rent ÷ total acquisition cost. Always lower than BR-YLD-01. Shown alongside it because duty and fees are capital the investor actually outlaid, and listing yields ignore them. The gap is typically 0.2–0.5 percentage points.

BR-YLD-03

Net operating income (NOI) = total effective income − total operating expenses. Uses effective rent, includes vacancy, excludes all finance costs.

BR-YLD-04

Net yield on price = NOI ÷ purchase price. Net yield on total cost = NOI ÷ total acquisition cost.

BR-YLD-05

Yields describe the asset, never the deal. Because NOI excludes finance, two buyers with different loans on the same property get identical yields — which is precisely what makes yield comparable between listings. A test asserts this. Any change that leaks finance cost into a yield is a defect.

BR-YLD-06

Yields are returned as decimal fractions and formatted as percentages for display.

BR-YLD-07

Gross yield on current value = annual gross rent ÷ current market value. Residential uses weekly asking rent × 52; commercial uses annual GST-exclusive gross passing rent. Vacancy, expenses and loan repayments are excluded. The current value follows BR-EQ-04. Zero current value returns null and displays “Not applicable” with an explanation. This appears alongside the purchase-price yield.

BR-CF-01

Annual cashflow = NOI − total annual repayments. Negative means the property costs the owner money to hold.

BR-CF-02

Cashflow is computed after principal repayment, i.e. it is true cash position, not "cost of holding". Principal is equity accumulation, so a cashflow-negative property is not necessarily losing money in net-worth terms. The result exposes interest and principal separately so this can be shown.

BR-CF-03

Weekly cashflow = annual ÷ 52, monthly = annual ÷ 12. The weekly figure is the primary headline: it is the number investors actually quote to each other.

BR-CF-04

The term "negatively geared" is not used in MVP output. It is a tax concept; at property level the correct description is cashflow-negative.

BR-CF-05

Cash-on-cash return = annual cashflow ÷ total cash required. Null when no cash was invested.

BR-BE-01

Break-even weekly rent is the weekly rent at which annual cashflow is exactly zero, all else held constant.

BR-BE-02

It is solved in closed form, not by adding the shortfall to the rent, because two expenses scale with rent: the management fee (a percentage of rent collected) and the letting fee (weeks of rent). Raising rent to cover a shortfall also raises the shortfall, so the naive answer always understates the rent required.

BR-BE-03

Formula: rent = (fixed expenses + total repayments − other income) ÷ (occupied weeks × (1 − management rate) − letting fee weeks). Where the denominator is ≤ 0, no break-even rent exists and zero is returned.

BR-BE-04

Two break-even rents are reported, both labelled: weeklyRent covers full P&I repayments; weeklyRentInterestOnly covers everything except principal. Both are legitimate and investors use both, so neither is chosen for the user. The gap between them is the weekly cash cost of principal repayment — money converted to equity rather than consumed. On an interest-only loan the two are equal.

BR-BE-05

Break-even interest rate is the rate at which annual cashflow is exactly zero, found by bisection over 0%–25%. Bisection rather than algebra because the annuity formula makes cashflow non-linear in the rate, and piecewise for IO-then-P&I loans.

BR-BE-06

Break-even interest rate returns null, not zero, when no crossing exists in range — either operating expenses alone exceed income (negative even at 0%), or the property stays positive above 25%. A null must display as "not applicable", never as 0%.

BR-EQ-01

For residential and commercial properties, current equity = user-entered current market value − current outstanding loan balance. Negative equity is preserved. Offset balances are not deducted from outstanding principal.

BR-EQ-02

Capital Growth vs Purchase ($) = current market value − purchase price. This excludes purchase costs, selling costs, debt repayments and tax; losses remain negative.

BR-EQ-03

Capital Growth vs Purchase (%) = capital growth ÷ purchase price, formatted as a percentage. This is cumulative, not annualised. A zero purchase price returns null and displays “Not applicable”.

BR-EQ-04

Until explicitly edited, current market value follows purchase price and current loan balance follows purchase price less deposit (floored at zero). These defaults are disclosed beside the inputs. Share links preserve explicit values, including zero; older links retain the derived defaults.

BR-EQ-05

The current snapshot is separate from acquisition costs, purchase yields and first-year loan/cashflow modelling. Current balances do not replace the original purchase loan in those calculations. The form states this distinction.

Stored transfer duty tables

These tables expose the data used by the application. Select the applicable bracket, then apply its published base and marginal rule. Total-value and quadratic rules have their own calculation shape. Figures below are in dollars. Source links provide the authority’s context and access to its current tools.