A dual income property in Bellbird Park, Brisbane, purchased at $467,400 with a 20% cash deposit of $93,480 pays you $7,979 per year (p.a.) which equals $153 per week (p/wk). Meanwhile, the same property purchased with no deposit (equity only) pays you $5,289 p.a. which equals $102 per week p/wk based on the following assumptions:
Annual rent combined: rent 1: $340 p/wk + rent 2: $240 p/wk = $580 x 52 weeks | Interest loan: 4.5% x $373,920 (or $476,510 if no deposit) | An initial purchase cost of $9,110 is needed to cover stamp duty ($5,040) and legal and loan fees ($4,070). Lender’s mortgage insurance [LMI] does not apply to these scenarios, however, if there were less deposit, by way of cash or equity, then LMI would be payable); These calculations factor in a 2% vacancy rate; Depreciation available only for new properties; Tax refund based on second highest tax bracket (39%); which incorporates a medicare levy of 2%
Calculation based on the first year.