What rate do you use for calculating cash flow of a potential purchase?

There is quite a difference between variable and fixed.
Do you use current variable rate? 2yr fixed? 3yr fixed?

 

2-2½% above what I'm borrowing at p&i.

 

I run a spreadsheet with the following potential scenarios

 

Couple spreadsheets - one for current rates (mainly for tax & tracking) & another stress test based on a 1.5-2% rate change @ P&I terms.

 

Same as Redom

One calc based on actual rates - and another based on 7%

Cheers

Jamie

 

Oh I am not talking about stress testing. Just wondering what to use for calculating cash flow today.

I got 2yr fixed P&I not long ago at 3.88
It looks like variable P&I now for investment is around 1% higher than that and variable IO is around anther 0.5% on top of that.

If I wanted to calculate cash flow for today, those 3 rates give wildly different cash flows - which one is generally used?

@Invest_noob - looks like you go with 5% so I guess you are using variable rate for calcs?

@Redom - I'm looking for what rate is used before adding the 1.5-2, would I use variable or fixed for standard cash flow calcs when looking at a property to purchase?

 

Just use your actual rate that your paying?

If not, pick 4.5 or 5% for a good indication of 'actual IO rates'.

 

current P+I
P+I based on +3% rate