How many properties for the retirement income you want?
A quick, honest estimate — based on properties owned outright and the rent they'd actually put in your pocket, not headline gross rent.
To generate about $105,350/year in net rental income, in today's dollars and before tax.
up front
to clear the debt
your income base
This shows the destination — how many properties, and how selling down clears the debt. Getting there depends on your borrowing capacity, the timing and funding of each purchase, cash flow along the way, and capital-gains tax and selling costs when you consolidate. Use it to picture the target, then map the real path with your broker and adviser.
1 · How many you'd need debt-free (the goal-seek)
Net rent per property = value × gross yield × (1 − holding costs). Owned outright at today's values you'd need target income ÷ today's net rent. But by retirement each property has grown, so it rents for more — and you need to keep fewer grown ones. That smaller number is the headline. Everything's in today's dollars.
2 · Growth outruns the debt (the key idea)
You buy more than you'll keep, each with a deposit and an interest-only loan — so the debt is fixed, it never grows. But the properties compound: at g% real for N years, each grows to about ×(1+g)^N. Thirty years at 3% real is roughly ×2.4. So a few grown properties are worth as much as the whole original debt.
The capital growth you enter is real — on top of inflation. We assume ~2.5%/yr inflation in the background and keep every figure in today's dollars. (A fixed interest-only debt actually erodes in real terms too — a tailwind we don't even count here.)
3 · Consolidate at retirement
Sell just enough grown properties to repay the entire (unchanged) debt — ceil(total debt ÷ grown value) of them — and keep the rest debt-free. Those keepers, sized to meet your target, are your income base.
What it deliberately leaves to your broker
This shows the destination — how many to hold and how the sell-down clears the debt. It does not model borrowing capacity / serviceability (can you get the loans?), the timing and funding of each purchase, cash flow during the build, capital-gains tax and selling costs (~2–3%, so you'd sell a little more), vacancy and rate moves, or the fact that growth is never a smooth line. Mapping the path to this destination is exactly your broker and adviser's job.