Monthly Loan Repayment – The monthly loan repayment represents the total amount of money that you spend on repaying loans every month.

Monthly Cash Operating Expenses – The monthly cash operating expenses are the amount of money that you will have pay each month on taxes associated with maintaining the property.

Cash Flow – The cash flow is another calculator term representing the difference between revenues and expenses (e.g. rental revenues less the loan repayments and cash operating expenses). It can be a positive number, measuring the amount of money that you would earn, or a negative number, representing the amount of money you would have to pay.

Annual Building Allowance – The annual building allowance represents the tax deduction you can make from the investment property. It varies upon the year when the property was built.

Annual Tax Profit/Loss on Property – This calculator factor combines the cash flow that the property will generate with tax deductions to measure the profit or loss.

Change in Tax Paid – This calculator factor measures the change in the income tax that the investor pays after owning the property, in comparison to what they would pay if they didn't own it. If it's a positive number, it means the investor will pay more tax, while if it's negative, it means he/she will pay less.

After Tax Profit/Loss on Investment – This factor represents the difference between the cash flow associated with the investment and the tax effect resulted from owning the property. It is aimed to measure the net effect of the private investment. A positive number means you will make profit, while a negative one means you will probably lose more money than you receive.

Although the calculator is just a rough estimation of the effects of a real estate investment on your income, you can use it to get a solid idea on whether it's worth looking at a private investment or not.


Here are some more investment property articles...