Question 1

What growth rate does property need to beat the ASX in Australia?

Accepted Answer

At this calculator's default settings — a 20% deposit, a 20-year horizon, an 8.5% ASX return and a 6.2% mortgage rate — property needs about 4.32% annual growth to match the shares path. The purchase price barely moves it: the model estimates rent as a flat 3.5% gross yield of the price, so mortgage, rent and equity all scale together, and the only price effect left is the tax on the share gain, which is added to $135,001 of other income in the sale year and taxed through the brackets, so a bigger gain pays a slightly higher average rate (4.33% at $400,000, 4.31% at $3,200,000). What does move the breakeven is your deposit size (5% deposit → 4.28%, 40% → 4.36%), your horizon (10 years → 4.05%, 30 years → 4.78%), the ASX return you assume (6% → 2.96%, 11% → 5.85%) and your mortgage rate (5% → 3.61%, 7.5% → 5.02%). Adjust those sliders to find your own number. These are estimates from the model's growth assumption (the 1 July 2027 value the reform needs is not a number the calculator can know), and they are the October 2026 readings: each moves by up to two hundredths of a percentage point (most by about one) between now and the 1 July 2027 reform date.

Question 2

How does leverage affect the property vs ASX comparison?

Accepted Answer

Leverage means a 20% deposit controls a 5× asset. This amplifies gains — but mortgage interest costs erode that advantage significantly. The higher the price relative to your deposit, the harder your property needs to work just to cover interest costs before it starts outperforming shares.

Question 3

What has the ASX returned historically?

Accepted Answer

The ASX 200 has returned approximately 9–10% per year including dividends over long periods. This calculator defaults to 8.5% as a conservative planning assumption. You can adjust this with the slider to model different scenarios.

Question 4

Is this calculator the same as the full Tepuy property vs shares model?

Accepted Answer

No — this is a simplified breakeven tool. It shows the minimum growth rate needed, not a full wealth comparison. The full Tepuy calculator includes stamp duty, CGT, negative gearing, rental income, Division 40/43 depreciation, and Monte Carlo risk modelling for a complete picture.

Question 5

Which Australian suburbs have the lowest breakeven growth rate?

Accepted Answer

This calculator does not rank suburbs by breakeven rate, because in this model the breakeven rate is almost the same everywhere. Rent is estimated as a flat 3.5% gross yield of the purchase price nationwide, so every term in the comparison scales with price; the one exception is the tax on the share gain, taxed through the brackets on top of $135,001 of other income, which makes the required growth rate 4.33% for a $400,000 home and 4.31% for a $3,200,000 one — about 4.32% at the default settings either way. Choosing your suburb changes the dollar figures shown (deposit, monthly repayment, final wealth), not the percentage. Whether a given suburb clears that bar is a question about its own growth history and outlook, which this calculator does not forecast.

Question 6

What is the breakeven property growth rate for a $900,000 home in Sydney?

Accepted Answer

About 4.4% per annum — but not because the home is in Sydney. For a $900,000 property with a 20% deposit ($180,000) and a 6.3% mortgage rate over 20 years, matching an 8.5% ASX return needs about 4.4% annual growth, and this model returns the same 4.4% for a $400,000 property and a $3,200,000 one on the same settings (4.39% and 4.36% to two decimals: the gain is taxed through the brackets, so a bigger one pays a slightly higher average rate). Rent is estimated as a flat 3.5% gross yield of the price nationwide, so price otherwise cancels out of the rate; it changes the dollar figures. Treat 4.4% as the bar this model sets at those settings, not as a Sydney-specific number — the calculator does not model city-level rental yields or growth.

Question 7

What is the breakeven growth rate for Brisbane or Perth property?

Accepted Answer

Almost the same rate this model gives everywhere else: about 4.4% per annum at a 20% deposit, a 20-year horizon, an 8.5% ASX return and a 6.3% mortgage rate. A $700,000 Brisbane property and a $1,500,000 Sydney one both return 4.4% here (4.38% and 4.37% to two decimals), because rent is estimated as a flat 3.5% gross yield of the price nationwide and the price therefore cancels out of the percentage except through the tax brackets on the share gain. Lower median prices in Brisbane and Perth change the deposit and repayment figures the calculator shows, not the growth rate required. This model does not use city-specific rental yields, so it cannot tell you whether Brisbane clears that bar more easily than Sydney.

Question 8

Does stamp duty affect the breakeven growth rate?

Accepted Answer

Not in this calculator. It doesn't include stamp duty, buying/selling costs, or property depreciation, so the breakeven growth rate it reports is the rate before those costs — in reality stamp duty is a real upfront cost, and a property would have to grow somewhat faster than the figure shown here to recover it. This tool deliberately models only deposit, mortgage repayments, rent and the shares alternative. For scale, Tepuy's stamp duty engine puts duty on a $900,000 NSW investment purchase at $34,687, but that amount does not enter this calculator's breakeven at all. To see the comparison with stamp duty, CGT, negative gearing, rental income and depreciation actually modelled, use the full property vs shares calculator.

Question 9

Has Australian property ever failed to beat the ASX over 20 years?

Accepted Answer

Yes. Over rolling 20-year periods, Australian residential property has underperformed the ASX in multiple cohorts — particularly in cities outside Sydney and Melbourne during the 1990s and early 2000s. Property's edge often comes from leverage and forced savings, not the underlying asset return. A share portfolio with the same leverage and discipline has historically outperformed in many scenarios.

Question 10

Why does this calculator show a different result to other property calculators?

Accepted Answer

Most property calculators only show property growth in isolation — they don't compare it to the alternative of investing the deposit. This calculator uses a breakeven framework: it asks what growth rate your property must achieve to match a shares portfolio, accounting for mortgage interest costs. The result is often higher than people expect because mortgage interest is a large ongoing drag on property returns.

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