Negative Gearing Calculator

Your purchase

Purchase price
$
Deposit amount
$
Would you like to calculate depreciation?
Interest rate (See special offers)
%
Property type
Growth rate of property
%
Number of borrowers

Income details

Gross income p.a. ?
$
Gross income p.a. (borrower 2) ?
$
Rental income
$
Increase in rent p.a.
%

Expenses per annum

We've estimated the expenses for your investment property.
Please change these figures as you see fit.

Repayments
Council rates
$
Strata
$
Insurance ?
$
Repairs and maintenance
$
Water rates
$
Property management fees Property mgmt. fees ?
%
Inflation
%

Contact a mortgage broker

Please email me a copy of the results:
Yes No
Talk to one of our mortgage brokers about your situation: Yes No  

Use our negative gearing calculator to work out the profit or loss from your investment property as well as your tax refund from negative gearing.

How does negative gearing work?

Investment properties have high once-off and ongoing costs, usually higher than the actual rent income will cover.

One-off costs

  • Your initial deposit.
  • Mortgage set-up fees including Lenders Mortgage Insurance (LMI) (if borrowing over 80% of the property value).
  • Stamp duty.
  • Solicitors, conveyancing and other legal fees.
  • Connecting electricity, water and gas.

Ongoing costs

  • Monthly property management fees.
  • Repairs and maintenance costs that vary but will invariably increase over time.
  • Monthly mortgage repayments plus annual interest payments.
  • Quarterly council and water rates.
  • Quarterly body corporate fees.
  • Annual land tax.
  • Annual mortgage account-keeping fees.
  • Annual building insurance.
  • Annual landlords insurance.

Note: The ongoing cost of holding the investment property can be deducted from your taxable income.

In addition to the deductions mentioned above, you may have such non-cash deductions as the depreciation of the building—an expense that’s included in your tax return but isn’t actually a cost that you physically pay.

Remember, falling into a lower tax bracket is a great win but it’s important to be aware of the fact that these wins won’t pay off until later down the track.

To educate yourself more on the topic, go through this guide about managing cash flow when negative gearing.


Is negative gearing worthwhile?

Many negatively-geared properties are in high demand areas that may potentially achieve higher rates of growth.

Property investors try to achieve more in growth than the cost to hold onto the property.

By amassing several properties like this, they can do quite well in the long term.

In some cases, the rental income will increase over time and the property will become positively geared.

You’ll lose your tax benefits but you won’t have to pay anything to hold onto the property.

Check out this page about negative gearing versus positive gearing to get an idea of the benefits and drawbacks of each strategy.

Before making a decision, it’s best you seek independent advice from a qualified accountant so you fully understand your tax obligations.


How do you calculate negative gearing?

We simply deduct the costs for the property or cash operating expenses, from the rental income you receive. This gives us your weekly cashflow.

For new properties, we can also deduct depreciation.

We can then calculate the effect that this will have on your taxable income and the amount of tax you would get back, depending on your tax rate.


Can you buy an investment property?

Our mortgage brokers are investment loan specialists.

We know which banks can help and who offers competitive discounts for high net worth investors.

Speak to our mortgage brokers by calling 1300 889 743 or fill in our free assessment form to find out if you can qualify for a professional discount.

Why use us?

We aim to set an example by delivering what we promise: a higher level of service, better advice and better home loans.

pin_drop

Australia-wide services

We finance properties anywhere in Australia for people anywhere in the world.

monetization_on

Get incredible interest rates

Our relationships with our panel of lenders allow us to negotiate your interest rate.

thumb_up

We get tough loans approved

We can help you navigate the often complex pre-approval and application process.

favorite

Our customers love us

We receive hundreds of love letters from our customers.

Discover more reasons to use Home Loan Experts

How we find you the right solution

We get a complete understanding of where you’re at and what your ultimate goals are.
You’ll get a recommendation in just a few simple steps.

1

Complete our free assessment form or call us.

2

We assess your situation.

3

We look at all the options from our panel of lenders.

4

We will find you the most suitable home loan deals.

Testimonials for Home loan experts

4.7
5.0
4.8

Facts
about us

50+

lenders on
our panel

$4B+

lent Australia-wide
and counting

Westpac
ANZ
Nab
AMP
Qudos
Firstmac
common wealth
St George
Homeloan
Macquire
Suncorp
Pepper
Me bank
Bankwest
75%

of our borrowers get
approved with a major bank

95%

of our borrowers get a discount
below the bank standard variable rate