Buy to Let / Investment Property Rent & Expenses Calculator

ABOUT THIS CALCULATOR: Only enter numbers (e.g. enter 65000 not $65000). If you try to enter a currency symbol you will get an NAN (Not A Number) error appear in each box. Whenever you insert a number or change an option, the calculator will re-calculate everything.

PURE INVESTMENT: Estimate how much rent you would need to charge to cover the costs of a property, assuming that you borrow the full value of the property. This is not a normal test but it gives you an idea of what the property should bring in if it were run as a pure investment. Only interest is calculated, not repayment of capital. In real life, other considerations apply such as capital gains (assuming that the property appreciates in value) and negative gearing (in some jurisdictions).

CHECK VALUATION: You might use this calculator to check if a property is overvalued. For example, if you would need to charge three or four times the market rent to cover costs then alarm bells might ring. This is not to say that the property is a poor investment. Property prices might rise so much that your capital gains outweigh other considerations. However, property prices can also fall dramatically.

BUY to LET & INVESTMENT PROPERTY CHECK: Calculate the rent needed to cover your real estate investment. Stamp duty and other one-off charges are not included and nor is paying off the capital. However, it's ideal for back-of-the-envelope estimations of annual gains or losses. If you own the property outright, then enter zero in the interest rate and / or property value. This gives a very quick way for older landlords and retirees to estimate their rental income in retirement.

DISCLAIMER: This calculator is offered as is with no guarantees. Any financial decision should be backed up with independent and professional advice and all calculations should be double-checked.

HOUSE PRICE: You can select the house price from the pulldown menu or enter a price in the box. You should choose the full market value of the house / flat / office. However, you can also just choose the amount borrowed on the property, if you like.

MORTGAGE INTEREST RATE: choose the interest rate that you are charged. Interest rates will vary so be conservative (i.e. choose a rate that will cover for possible rate rises).

REPAIRS You should always budget for repairs, from blown-down fences to leaky roofs, from blocked toilets to damaged floors. From termite infestations to hail damage. Some may be covered by insurance but there are always excesses to be paid and some events are uninsured.

HOUSE INSURANCE Landlords and owners must always insure the fabric of their homes enough to cover (at least) rebuilding costs. You might also want to cover for loss of rent or alternative accommodation, site remediation, etc.

LANDLORD INSURANCE Landlords should insure against malicious damage and (possibly) loss of rent. This insurance should also cover liability (which can run into many millions).

RATES Also called council rates, council taxes or property taxes, these are regular local government charges that cover things like rubbish removal, schools, and police. Depending on your jurisdiction, you might need to include rates as a cost (some tenants pay the rates, and that will be reflected in the rent they pay). Some jurisdictions have an additional land tax for landlords (this happens in Canberra).

STRATA LEVIES Also called body corporate fees and owner's corporation fees. These are regular charges that cover maintenance and insurance in strata properties. For example, a block of flats will have a strata committee or similar to cover roof repairs, gardens, lifts (elevators) etc. Shared pools or gyms can make these charges very high.

GARDENS Landlords may have very high ongoing gardening costs, depending on the type of property and the tenancy agreement. Some tenants may mow the lawns and do tidying up but major stuff, like tree pruning or removal, tends to be the responsibility of the owner. Tree surgery can be very expensive, with tree removal going into many thousands.

SERVICING Air conditioning, heating, and hot water systems all need regular servicing and maintenance which should be budgeted for. You might include preventative plumbing.

MARKET RENT: choose a market rent for the property. This is what the prevailing market (in this area, and for this type of property) will pay. This calculator works on a weekly rental.

AGENT'S CUT: choose or enter the percentage that the letting agent will take in commission for letting the property (agent fees).

TOTAL INTEREST PAYMENTS PER YEAR: this is the amount borrowed multiplied by the annual interest rate.

COST PER YEAR: this is the total interest payments plus all the other property costs.

MARKET RENT: gross annual income: this is the total rental payments collected by the agent.

MARKET RENT: net annual income: this is the total rental payments collected by the agent minus the agent's commission.

THEORETICAL RENT: annual rent needed to cover costs: this is the theoretical rent that you would need to charge per year to cover interest repayments + costs + agent's commission.

WEEKLY RENT NEEDED TO COVER COSTS: this is the theoretical rent that you would need to charge per week to cover interest repayments + costs + agent's commission.

THEORETICAL / MARKET RENT: this ratio is the theoretical rent divided by the market rent. For example, if you needed to charge $1,500 per week to cover all your costs but the market would only tolerate $500 per week this value would be 3 ($1,500 / $500).

INCOME: this is the money that you make or lose per year. It is calculated by subtracting the total costs per year from the net annual market rent.