{ "cells": [ { "cell_type": "code", "execution_count": 2, "metadata": {}, "outputs": [], "source": [ "from dataclasses import dataclass\n", "\n", "@dataclass\n", "class PropertyFinanceParams:\n", " \"\"\"Tunable parameters that describe the finances of a property.\"\"\"\n", " purchase_price: float\n", " deposit_amount: float\n", " loan_duration_years: int\n", " lmi_amount: float\n", " annual_rental_income: float\n", " annual_rental_growth_rate: float\n", " annual_interest_rate: float\n", " annual_growth_rate: float" ] }, { "cell_type": "code", "execution_count": 3, "metadata": {}, "outputs": [], "source": [ "def calculate_stamp_duty(purchase_price: float, first_home: bool) -> float:\n", " if first_home:\n", " if purchase_price < 600000:\n", " return 0\n", " elif purchase_price < 605000:\n", " return 1045\n", " elif purchase_price < 625000:\n", " return 5428\n", " elif purchase_price < 650000:\n", " return 11356\n", " elif purchase_price < 675000:\n", " return 17785\n", " elif purchase_price < 700000:\n", " return 24713\n", " elif purchase_price < 725000:\n", " return 32141\n", " elif purchase_price < 745000:\n", " return 38444\n", " else:\n", " return\n", " else:\n", " if purchase_price < 25000:\n", " return purchase_price * 0.014\n", " elif purchase_price < 130000:\n", " return 350 + (purchase_price - 25000) * 0.024\n", " elif purchase_price < 960000:\n", " return 2870 + (purchase_price - 130000) * 0.06\n", " elif purchase_price < 2000000:\n", " return purchase_price * 0.055\n", " else:\n", " return 110000 + (purchase_price - 2000000) * 0.065\n", " \n", "def calculate_annual_repayments(principal: float, annual_interest_rate: float, loan_duration_years: int):\n", " return (principal * annual_interest_rate * (1 + annual_interest_rate) ** loan_duration_years) / ((1 + annual_interest_rate) ** loan_duration_years - 1)" ] }, { "cell_type": "code", "execution_count": 4, "metadata": {}, "outputs": [ { "name": "stdout", "output_type": "stream", "text": [ "Upfront Costs: 321500.00 = 250000.00 deposit + 0.00 LMI + 71500.00 stamp duty\n", "Annual Mortgage Payment: 81241.59\n", "\n", "Total Paid: 2437247.81\n", "Property Value: 9895931.56\n", "Total Interest Paid: 1387247.81\n", "Total Rental Income: 116762.31\n", "\n", "Total Paid (10yr): 812415.94\n", "Property Value (10yr): 2557296.76\n", "Total Interest Paid (10yr): 650510.03\n", "Total Principal Paid (10yr): 161905.91\n", "Total Rental Income (10yr): 432219.86\n", "Net Cash Position (10yr): -380196.08\n", "Loan Balance (10yr): 888094.09\n", "Total Equity (10yr): 1669202.67\n" ] } ], "source": [ "def run_simulation(property_finance_params: PropertyFinanceParams):\n", " initial_loan_amount = property_finance_params.purchase_price - property_finance_params.deposit_amount\n", " yearly_loan_balance = [initial_loan_amount]\n", "\n", " stamp_duty = calculate_stamp_duty(property_finance_params.purchase_price, first_home=False)\n", " upfront_costs = stamp_duty + property_finance_params.deposit_amount + property_finance_params.lmi_amount\n", "\n", " print(f\"Upfront Costs: {upfront_costs:.2f} = {property_finance_params.deposit_amount:.2f} deposit + {property_finance_params.lmi_amount:.2f} LMI + {stamp_duty:.2f} stamp duty\")\n", "\n", " annual_mortgage_payment = calculate_annual_repayments(initial_loan_amount, property_finance_params.annual_interest_rate, \n", " property_finance_params.loan_duration_years)\n", " \n", " print(f\"Annual Mortgage Payment: {annual_mortgage_payment:.2f}\")\n", "\n", " yearly_interest_paid = []\n", " yearly_principal_paid = []\n", " yearly_property_value = [property_finance_params.purchase_price]\n", " yearly_rental_income = [property_finance_params.annual_rental_income]\n", "\n", " for year in range(property_finance_params.loan_duration_years):\n", " interest_paid = yearly_loan_balance[-1] * property_finance_params.annual_interest_rate\n", " yearly_interest_paid.append(interest_paid)\n", " yearly_principal_paid.append(annual_mortgage_payment - interest_paid)\n", "\n", " yearly_loan_balance.append(yearly_loan_balance[-1] - yearly_principal_paid[-1])\n", "\n", " yearly_property_value.append(yearly_property_value[-1] * (1 + property_finance_params.annual_growth_rate))\n", "\n", " yearly_rental_income.append(yearly_rental_income[-1] * (1 + property_finance_params.annual_rental_growth_rate))\n", "\n", " if yearly_loan_balance[-1] <= 0:\n", " break # Loan fully paid off\n", "\n", " print()\n", "\n", " print(f\"Total Paid: {annual_mortgage_payment * property_finance_params.loan_duration_years:.2f}\")\n", " print(f\"Property Value: {yearly_property_value[-1]:.2f}\")\n", " print(f\"Total Interest Paid: {sum(yearly_interest_paid):.2f}\")\n", " print(f\"Total Rental Income: {yearly_rental_income[-1]:.2f}\")\n", "\n", " print()\n", "\n", " print(f\"Total Paid (10yr): {annual_mortgage_payment * 10:.2f}\")\n", " print(f\"Property Value (10yr): {yearly_property_value[10]:.2f}\")\n", " print(f\"Total Interest Paid (10yr): {sum(yearly_interest_paid[:10]):.2f}\")\n", " print(f\"Total Principal Paid (10yr): {sum(yearly_principal_paid[:10]):.2f}\")\n", " print(f\"Total Rental Income (10yr): {sum(yearly_rental_income[:10]):.2f}\")\n", " print(f\"Net Cash Position (10yr): {sum(yearly_rental_income[:10]) - (annual_mortgage_payment * 10):.2f}\")\n", " print(f\"Loan Balance (10yr): {yearly_loan_balance[10]:.2f}\")\n", " print(f\"Total Equity (10yr): {yearly_property_value[10] - yearly_loan_balance[10]:.2f}\")\n", "\n", "\n", "run_simulation(\n", " PropertyFinanceParams(\n", " 1300000,\n", " 250000,\n", " 30,\n", " 0,\n", " 36000,\n", " 0.04,\n", " 0.066,\n", " 0.07)\n", ")" ] } ], "metadata": { "kernelspec": { "display_name": "investment-simulator-KPfGkdIO-py3.12", "language": "python", "name": "python3" }, "language_info": { "codemirror_mode": { "name": "ipython", "version": 3 }, "file_extension": ".py", "mimetype": "text/x-python", "name": "python", "nbconvert_exporter": "python", "pygments_lexer": "ipython3", "version": "3.12.0" }, "orig_nbformat": 4 }, "nbformat": 4, "nbformat_minor": 2 }