NPV / IRR Property Investment Calculator — South Africa
Calculate the Net Present Value and Internal Rate of Return of any SA investment property. The metrics serious investors use.
Net Present Value — discounts all future cash flows to today's money. Positive = good investment at your required return.
Internal Rate of Return — the actual annualised return on your equity invested. Compare to your required return.
NPV / IRR Calculator
Advanced property investment analysis for South African investors
Annual Cash Flow Projection
| Year | Annual Rent | Annual Costs | Bond Repayment | Net Cash Flow | Property Value |
|---|
* IRR is calculated on equity (deposit) invested. NPV uses your required rate of return as the discount rate. CGT is estimated on the capital gain at exit. Bond term assumed 20 years. All projections are estimates — actual returns will vary.
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Understanding NPV and IRR in Property Investment
Common questions about these metrics
▸ What does a positive NPV mean?
A positive NPV means the investment generates more value than your required rate of return demands. If your required return is 12% and the NPV is positive, the property exceeds that threshold. The larger the positive NPV, the better the investment relative to your benchmark.
▸ What is a good IRR for SA property?
An IRR of 12–18% is considered strong for South African residential property. Below 10% may not justify the illiquidity and management effort versus listed property investments. Above 20% indicates exceptional returns, usually with higher risk.
▸ Why use NPV/IRR instead of just yield?
Yield is a static snapshot. NPV and IRR incorporate the time value of money, the full holding period including capital growth, the exit proceeds after CGT, and all cash flows over time. They give a complete picture of investment performance that yield alone cannot provide.
How to Use This Calculator
Enter your purchase price and deposit — the deposit is your equity invested. Add monthly rent and costs, bond rate (10.75% = prime + 0.5%), and your required return. Use 12% if unsure.
A positive NPV means the property beats your required return. The IRR is your actual annualised return on equity. Above 12% is strong for SA residential property. The year-by-year table shows exactly when cash flow turns positive.