I should've made it clear. Nobody has a property to cash in at $600k, minus agent's fee and shove it in the bank. I don't understand the low tax you calculated. Tax up to $80k is $4650 plus 30%(30c in the dollar). $26k interest would lose $7,800 to Mr ATO. To use the couple in the article. They obviously earn decent money to afford $535/week rent for an apartment. They can easily buy a property in Perth for $350k, which unlike your extreme example, I don't think would be losing $50k per year. It may lose something but like I stated, there must be a plateau for prices, unless someone is trying to tell me you will be able to pick up brand new house and land packages for $150k in metropolitan Perth within a few years.
To assume that you can rent for two years and rebuy cheaper is speculation.
Also, when this forum debunks growth it's quick to remove inflation but I noticed this wasn't in your calculation. The 4.5% interest is more like 0 because contrary to official inflation figures, 4.5% is more like it when you look at your costs in the real world.
$28k in rent is pissing money to the wind, especially for an apartment. $28k could easily service a nice home hands down with change left over for a modest holiday.
