Investment vs Interest vs Rent Comparison
This table demonstrates how different levels of investment can influence rental income, borrowing costs, and overall cashflow for residential properties in Canberra.
While higher investment can unlock stronger rental returns through improved design and functionality, it also increases interest costs. This comparison highlights how these factors interact, and where different investment levels may deliver stronger outcomes.
Investment vs Interest vs Rent Comparison (Scaled Income + Depreciation)
|
Investment (Loan) |
Typical Configuration |
Annual Interest (6%) |
Weekly Rent |
Annual Rent |
Difference (Rent – Interest) |
Depreciation (2.5%) |
|---|---|---|---|---|---|---|
|
$200,000 |
1 bedroom |
$12,000 |
$500 |
$26,000 |
+$14,000 |
$5,000 |
|
$250,000 |
1–2 bedroom |
$15,000 |
$550 |
$28,600 |
+$13,600 |
$6,250 |
|
$300,000 |
2-3 bedroom |
$18,000 |
$625 |
$32,500 |
+$14,500 |
$7,500 |
|
$350,000 |
3 bedroom |
$21,000 |
$700 |
$36,400 |
+$15,400 |
$8,750 |
|
$400,000 |
4 bedroom |
$24,000 |
$1,000 |
$52,000 |
+$28,000 |
$10,000 |
Assumptions and Methodology
The figures presented in this table are based on rental income prior to the deduction of management fees, vacancy allowances, maintenance, and other operating costs.
Interest has been calculated using a benchmark rate consistent with average investor interest-only loan rates in March 2026.
Depreciation has been estimated using a single conservative method, applying a 2.5% capital works rate to the construction cost.
Rental income assumptions are based on comparable rental outcomes observed across recently completed Canberra granny flat and small dwelling builds.
To discuss this email clientservices@cgfb.com.au or call 0400446605 - Frank Walmsley