Maximum Weekly Cash Subsidy

In many occasions, holding an investment property results with an investor paying money out of their own pocket. This is because the property is generating a cash loss. If the investor does not have the cash available to subsidise the loss, the investor will be at risk of financial distress.

The calculator below helps you understand what level of cash you have available to subsidise your property.

Use this number

Worked Example

A property investor earns $3,000 a month. He pays $600 a month in food and groceries, $500 in utilities, $1,000 in mortgage payments for his home and $700 in his children's education. This means that the investor can afford to pay $50 a week ($200 a month) to subsidies his investment property.

If his property investment is expected to generate a cash loss of $3500 per year, the investor will have to pay $67.31 per week ($3500 / 52 weeks) out of his own pocket to subsidise the property. Since his Maximum Weekly Cash Subsidy is $50 per week then the investment property is exceeding Joe's risk exposure.