Compare Queensland Investment Property Cash Flow
Three numbers describe an investment property and they are not interchangeable. Gross yield is a year of rent divided by the price. Net operating income takes the running costs off the rent. Cash flow after finance takes the loan repayment off as well, principal included, because principal is money that leaves your account.
Request property income and cost details
Tell us the property or the budget you are weighing up. FAA comes back with the rent, the running costs and the finance assumptions set out line by line, and says which ones are estimates.
- Gross Yield
- Net Operating Income
- Cash Flow After Finance
- Sources Named
General information only, and not financial, tax or credit advice. This page carries no property figures. Every input named on it has to come from the property's own documents or from a published source with a date on it.
THE THREE MEASURES
Review the income, the costs and the finance separately
Review rental-income estimates, ownership costs and financing assumptions before choosing your next investment property. Most comparisons come apart at the first step, because the two properties are being measured with different rulers.
Gross yield describes the house. Cash flow describes your purchase of it. Put a 20 per cent deposit on one property and a 40 per cent deposit on another and the second will look like the better buy on cash flow alone, when all you have done is put more of your own money in. Net operating income is the rung in the middle that makes the two comparable again.
Each rung answers something the other two cannot, so a single figure quoted without saying which one it is tells you very little.
- 1
Gross rental yield
A year of rent, divided by the purchase price.
- In
- Rent. Price.
- Out
- Every running cost. The loan, in full.
- Answers
- Whether this property earns well for what it costs to buy.
- 2
Net operating income
A year of rent, minus the costs of running the property.
- In
- Management, letting fees, rates, body corporate, insurance, maintenance, land tax, the water service charge, and the weeks it sits empty.
- Out
- The loan, still in full. Interest and principal both.
- Answers
- What the property leaves before anyone is paid for lending you the money.
- 3
Cash flow after finance
Net operating income, minus the loan repayment.
- In
- Interest. And principal, wherever the loan is principal and interest, because that is money leaving your account.
- Out
- Tax. Every figure on this page is pre-tax.
- Answers
- Whether you are topping the property up each month, and by how much.
PRINCIPAL REPAYMENTS
Deductible and payable are two different questions
The ATO allows a deduction for the interest charged on a loan used to buy a rental property, and states that you cannot claim a deduction for payments that reduce the principal. That rule is about tax. It says nothing about your bank balance.
So principal sits outside the tax calculation and inside the cash one. Wherever a figure is meant to represent money actually leaving your account, the principal portion belongs in it. A cash flow number that quietly drops principal is describing an interest-only loan, whether or not it says so, and the day an interest-only period ends is the day that becomes obvious.
The repayment basis is a published variable rather than a detail. The Reserve Bank's Statistical Table F6 separates new housing loans by repayment type, by loan size and by loan-to-value ratio, so interest-only against principal and interest is a difference you can look up before you assume it away. Yield will not move when you switch between them. Cash flow will.
Everything on this page sits before tax. The tax treatment of a rental loss changes from 1 July 2027 and that change has its own page, which is where it belongs rather than folded into an arithmetic explainer.
THE STATEMENT
Every line, and where its figure has to come from
This is the whole statement, in the order it has to be worked. The value column is missing on purpose, and the next section explains why. Ask for a property and you get the same lines with the figures filled in and each assumption named.
Income
The numerator, and the one every line below inherits. Costs and loan repayments do not move with it, so an overstated rent moves net operating income and cash flow by more than it moves the rent.
- Gross annual rent
- A written rental appraisal on the property, or the Residential Tenancies Authority median for that postcode, dwelling type and bedroom count. The RTA works its medians out from new bond lodgements, so they are rents tenants actually signed, and they revise each quarter. An advertised rent is what an agent is asking.
- Less a vacancy allowance
- Your own assumption, stated in weeks. Nobody publishes a standard. ASIC's Moneysmart puts it as a question instead: work out whether you could cover every expense short term with no tenant at all.
Subtotal: Effective rent
Running costs
Quotes and notices, not percentages of rent. A percentage is how a cost model stops being a cost model.
- Management fee, letting fee, lease renewal fee
- FAA's fee schedule, quoted for the property, with the GST treatment stated. This page quotes no percentage, because FAA's schedule is not published and an industry average is not FAA's rate.
- Council rates and separate levies
- The rate notice for that lot, not an estimate. Billing cycles and separate levies differ by council, so read the notice for the council the property sits in rather than assuming another council's pattern.
- Body corporate levies
- The disclosure statement, where the lot sits in a scheme. Administrative and sinking fund contributions are ongoing; a special levy raised for a capital improvement is a different animal.
- Building and landlord insurance
- A quote on the property, not a rule of thumb. Moneysmart lists insurance among the ongoing costs of an investment property, and landlord cover is a separate product from building cover.
- Repairs and maintenance
- An allowance you set and can defend. An older dwelling and a new build do not carry the same number, and no regulator publishes one.
- Queensland land tax
- The Queensland Revenue Office threshold, against the taxable value of your total Queensland landholdings at 30 June. It runs on land value, not on what you paid, so it can read nil on an expensive house.
- Water fixed service charge
- The retailer's charge for that property. Usage normally sits with the tenant under a compliant tenancy; the fixed service charge stays with the owner.
Subtotal: Net operating income
Finance
Where the two properties you are comparing stop being comparable, because this block describes your purchase and not the house.
- Loan interest
- Your lender's actual offer. For a reference before you have one, the Reserve Bank publishes average rates on new housing loans in Statistical Table F6, broken down by investor and owner-occupier, by repayment type, by loan size and by loan-to-value ratio.
- Principal repayment
- Your loan's own schedule, where it is principal and interest. Nil during an interest-only period, and it arrives in full on the day that period ends.
Subtotal: Cash flow after finance
Upfront, and outside all three measures
Cash that leaves the account once, at settlement. It belongs in what the purchase costs you and in none of the three annual figures above.
- Queensland transfer duty
- The Queensland Revenue Office transfer duty rate table, worked on the dutiable value. Add the additional foreign acquirer duty where the buyer is a foreign person, company or trust.
- Titles Queensland lodgement fees
- Their published fee schedule, on the transfer and again on the mortgage. Both are reset on 1 July each year.
- Conveyancing, building and pest, lender fees
- Quotes. Borrowing expenses over $100 are spread across five years or the loan term, whichever is shorter, rather than claimed in the first year.
WHAT IS NOT HERE
There is no worked example on this page, and there is a reason
A page about numbers that shows none looks like an oversight, so here is the reason in full. A worked example is one property's purchase price, one property's rent, and one owner's allowances and finance. All of it is somebody's real data. FAA has not released a property with permission to publish its figures, and the honest options at that point are to wait or to make them up.
Making them up would be cheap and it would work. A price, a rent and a set of round allowances reads as authoritative, and readers treat an illustration as typical no matter what the caption says. On the one page whose entire argument is that the numbers are handled honestly, that is the worst possible thing to invent.
So the example is the thing you request rather than the thing you read. Send us a property you are weighing up, or a budget and a location, and the lines above come back filled in for it, with the source or assumption named beside each one and the estimates marked as estimates.
One more disclosure before you weigh any of it. FAA Property earns a commission from builders and developers when a property purchase proceeds. The strategy session itself costs you nothing. Because we are paid by the supply side, you should weigh our recommendations with that in mind.
Send us a property and get these lines filled in for it
Where a figure on this page is allowed to come from
Six sources, in the order they get asked. The property's own paperwork beats every published average, and a published average beats a number somebody remembered.
The property's own paperwork
The rate notice, the body corporate disclosure statement, the insurance quote, the lender's offer. First in the order every time, because it describes the lot you are buying rather than the market it sits in.
Residential Tenancies Authority
Median weekly rents by postcode, suburb and local government area, across dwelling types and bedroom counts, worked out from new bond lodgements each quarter. Medians rather than averages, so one unusual rent cannot drag the figure.
Reserve Bank of Australia
Statistical Table F6 publishes average interest rates on new and outstanding housing loans, split by investor and owner-occupier, by repayment type, by loan size and by loan-to-value ratio. Use it for a reference rate, not the cash rate.
Australian Taxation Office
Which rental expenses are an immediate deduction, which are borrowing expenses spread over five years, and which are acquisition costs that are not deductible at all. It is also the source for the principal rule further up this page.
ASIC Moneysmart
The ongoing-cost list that carries insurance, and the vacancy question: could you cover every expense short term with no tenant. Moneysmart's own line is that you should not rely on rental income to cover the mortgage.
Queensland Revenue Office
The transfer duty rate table, the additional foreign acquirer duty, and the land tax thresholds and bands. Duty is one of the few numbers in a property purchase you can work out exactly before you commit.
THE DOWNSIDE CASE
Run the worse version first
Six changes, one at a time, each with a published reference behind it. Watch which subtotal moves, because that tells you which of the three measures the change actually affects.
Take the rent down to the median
Replace the advertised rent with the RTA median for that postcode, dwelling type and bedroom count. If the property only works at the asking rent, you have found that out for free.
Add weeks with no tenant
Vacancy is the input people leave alone, and it is what separates an advertised return from an achieved one. Run it at four weeks, then at eight, and watch which subtotal moves first.
Lift the interest rate
Re-run the finance block a full percentage point higher. RBA Table F6 shows the spread between repayment types and between loan-to-value bands, so a rate is a range you sit inside rather than a single number.
Switch interest-only to principal and interest
Gross yield does not move. Net operating income does not move. Cash flow after finance moves a long way, which is the clearest demonstration on this page that the three measure different things.
Add the cost you have not quoted yet
Insurance and maintenance are the two people carry as a percentage. Get a real quote on the first and set a defensible allowance on the second, then run it again.
Then look at the upside case
Positive cash flow is a scenario to assess, not a target to chase, and whether it is the right one depends on your position and your tax situation, which this page cannot know.
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Cash Flow and Yield: Frequently Asked Questions
Yield describes the property. Cash flow describes your purchase of it. Gross yield is a year of rent divided by the price, with no loan in it, so two buyers putting down a 20 per cent deposit and a 40 per cent deposit on the same house get the same yield. Cash flow takes the loan repayment off as well, so those two buyers get very different answers. A yield figure on its own cannot tell you whether a property pays for itself.
It has to, wherever the loan is principal and interest, because the principal portion is money leaving your account that month. Tax works the other way: the ATO allows a deduction for the interest charged on the loan and says you cannot claim a deduction for payments that reduce the principal. So principal sits outside the tax calculation and inside the cash one, and a cash flow figure that quietly drops it is describing an interest-only loan whether it says so or not.
A year of rent, minus the costs of running the property, with the loan left out entirely. Management and letting fees, council rates and separate levies, body corporate contributions, building and landlord insurance, repairs and maintenance, land tax, the water service charge, and an allowance for the weeks it sits empty. It is the figure that tells you what the property leaves before anyone is paid for lending you the money, which is why it is the honest way to compare two properties bought on different deposits.
Because every figure in one would be a real property's real numbers, and FAA has not released a property and its assumptions for publication. Inventing a purchase price, a rent and a set of allowances would be inventing the whole thing, on the one page where that matters most. Ask for the details on a property you are actually looking at and you get the lines above filled in, with each assumption named beside it.
Change one input at a time and watch which subtotal moves. Drop the rent to the RTA median for that postcode and bedroom count. Add four weeks with no tenant, then eight. Lift the interest rate by a full percentage point. Switch an interest-only loan to principal and interest. Each of those has a published reference behind it, so a downside case is arithmetic on real inputs rather than pessimism.
It can, and that is the trap. A larger deposit shrinks the loan, so the interest line falls and cash flow improves, while gross yield and net operating income do not move at all. The property has not become a better property. You have put more of your own money into it, which is a decision about your position rather than about the house, so compare the two on net operating income before you compare them on cash flow.
It is one scenario to assess rather than a target that suits everyone. A property can pay for itself from day one and still be the wrong purchase for you, and a property that needs topping up can suit a different position entirely. Which one is right turns on your income, your tax position and your timeframe, and none of that is knowable from a page. FAA is a licensed real estate agency, not a financial adviser, so get licensed advice on that part.
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Learn moreBy Kayla Dale, Senior Property Manager and Sales Agent, FAA Property. Reviewed against ATO and ASIC Moneysmart guidance, 14 September 2026.
General information only. FAA Property does not provide personal financial, tax or credit advice, and nothing here considers your own position. The definitions on this page are arithmetic; the figures that go into them are not published here and have to come from the property and from your lender. Deductibility rules come from the Australian Taxation Office rental properties guidance, ongoing-cost and vacancy points from ASIC Moneysmart, reference lending rates from Reserve Bank Statistical Table F6, median weekly rents from the Residential Tenancies Authority, and duty and land tax from the Queensland Revenue Office. Check each against its publisher before you rely on it. FAA Property Pty Ltd holds QLD OFT real estate licence 4220395. FAA Property earns a commission from builders and developers when a property purchase proceeds. The strategy session itself costs you nothing. Because we are paid by the supply side, you should weigh our recommendations with that in mind.