Calculator - worth sharing?

[melb]

Hi all,

I tried to find an online calculator that estimates the return on property investment over time, and I wanted to compare the result to if I put the same amount of money into a cash saving account, taking into its calculations the tax (deductions). I couldn't find one, so being a web programmer I just created one myself.

At its current state it's quite ugly and not very user friendly because I just built it for my own use. But now I'm thinking if there's others who want to use it as well I'm happy to spend more time to make it more "presentable" and share it.

Here it is at its current state:
http://loan.webnyx.com/

Is it worth sharing and spending more time on? Thanks in advance for any feedback.

 

[mrmonopoly]

Hi all,

I tried to find an online calculator that estimates the return on property investment over time, and I wanted to compare the result to if I put the same amount of money into a cash saving account, taking into its calculations the tax (deductions). I couldn't find one, so being a web programmer I just created one myself.

At its current state it's quite ugly and not very user friendly because I just built it for my own use. But now I'm thinking if there's others who want to use it as well I'm happy to spend more time to make it more "presentable" and share it.

Here it is at its current state:
http://loan.webnyx.com/

Is it worth sharing and spending more time on? Thanks in advance for any feedback.

Thanks Melb, if you think this is ugly you should see my excel spreadsheets lol.

There are a few ROI calculators lurking about on here somewhere if you do a search.

 

[willb]

Hi Melb

I am currently building a website for property investers that include all the calcs that you could possibly need. Just wondering if i can use this on the website as well.

Cheers

Will

 

[melb]

Hi mrmonopoly,

The feature that I couldn't find was the performance comparison compared to putting the money in a saving account. So for each repayment (minus rental income), rental income tax and other ongoing costs, I compare it to putting the same amount to a saving account. To make the comparison fair, in a negative gearing situation, I mirror the tax deduction as a withdrawal in the saving account.

Basically I wanted to answer the question, how long would it take for my IP to outperform the return from leaving the money sitting in the bank, which is low risk and hassle free?

If you go to the site and see the result from the default inputs, you can see the IP would start to consistently be in a positive position, shown in the 'Current Position' column(*) from month #48. However, at that time the return from the saving account would still be 278% higher. In fact, the IP would only start consistently outperform the savings, marked with green color, from month #168 (year #14) onwards. So if I was in that situation and in my investment strategy I wanted to exit in year #10 for example, IP would not be a good investment option for me.

I tried to find a calculator / tool that did this in here and on Google but couldn't find one. I'm not sure if investors don't usually estimate their investment return this way?


(*) The "current position" doesn't take into account the property selling costs and CGT.

 

[tobe]

How about purchasing the somersoft software? Im sure that would do all that you need it to do.....

 

[devank]

Somebody has to develop a software where you can simply convert excel sheet into functioning webpage

 

[melb]

@tobe:
I didn't know about the Somersoft software. Are you referring to this one: http://www.somersoft.com.au/pia/ ? I still couldn't find the feature that I mentioned there though.

@devank:
You could just use Google Docs ( http://docs.google.com ). You can create, edit and view your spreadsheet on your web browser.

@willb:
Can you private message me your website's address please?

 

[Peter_Tersteeg]

The PIA software does show you the ROI as well as numerous other things, but it's not designed for other investments (outside of property) so it can't directly be used as a comparison tool.

PIA also includes numerous other features, such as depreciation, which do effect your bottom line. I believe it's also been certified from an accountant's point of view.

I like where you're going with this and I do think PIA has some flaws (it's predominatly designed around negative geared / capital growth property), but you probably want to take a closer look at PIA to help you develop this tool.

 

[melb]

Hi PT_Bear,

It looks like the PIA is a very useful software to purchase. For features that already exist and I have access to, I'd rather not re-invent the wheel and just use the existing ones. In terms of price it seems it's well worth the time saving from having to build my own anyway.

I guess I had 2 main reasons posting this thread:
1. To see if it's worth sharing the tool rather than bury it and forget about it very soon.
2. To verify that I'm looking at IP the right way. Considering I can't find the tool that does what I wanted to find, being a newbie I can't help but wonder, do investors look at the profitability of IP investment differently? Am I missing something?

 

[mrmonopoly]

Hi mrmonopoly,

The feature that I couldn't find was the performance comparison compared to putting the money in a saving account. So for each repayment (minus rental income), rental income tax and other ongoing costs, I compare it to putting the same amount to a saving account. To make the comparison fair, in a negative gearing situation, I mirror the tax deduction as a withdrawal in the saving account.

Basically I wanted to answer the question, how long would it take for my IP to outperform the return from leaving the money sitting in the bank, which is low risk and hassle free?

If you go to the site and see the result from the default inputs, you can see the IP would start to consistently be in a positive position, shown in the 'Current Position' column(*) from month #48. However, at that time the return from the saving account would still be 278% higher. In fact, the IP would only start consistently outperform the savings, marked with green color, from month #168 (year #14) onwards. So if I was in that situation and in my investment strategy I wanted to exit in year #10 for example, IP would not be a good investment option for me.

I tried to find a calculator / tool that did this in here and on Google but couldn't find one. I'm not sure if investors don't usually estimate their investment return this way?


(*) The "current position" doesn't take into account the property selling costs and CGT.

Whilst I feel cash in the bank is useful from a buffer and risk mitigation perspective I do find the total returns very poor compared to that of my other investments especially when you take into consideration the fact that the gains are mostly eroded away by tax(unless in offset) and inflation. For this reason I dont give it great prominence in my comparisons.

I like to use ROI forecast calculators for end game visualisation purposes but the beauty about property investment is how you can manufacture positive returns on so many levels.

There are few investment vehicles I know of where you can improve the capital return and rental return so greatly all whilst using leverage to compound the total return and achieve those end goals.

It is understanding how to do this and taking action which separates the average results from the outperformers.

Just my opinion