Do you want to buy or rent a house in Australia?

Australian adults face one of the most difficult financial decisions: whether to buy or rent a house. Each option comes with its own pros and cons. It all comes down to your personal and financial preferences.

Propagators of homeownership believe that owning a home gives you security and you are guaranteed that your mortgage payments will be paid. You also have the freedom and flexibility to make improvements to your home that will increase its value.

Renters argue, however, that purchasing a home is not possible for everyone due to the high cost of financing. Renting gives you more freedom as you can move around freely once your lease ends. The landlord often takes care of property maintenance so that you do not have to.

What is the best way to save money on a house in Australia?

The age-old question of “Is it better to rent or buy a house?” is still relevant. Realestate.com.au recently conducted an analysis and may have some insights.

The group performed a 10-year study of all expenses associated with buying or renting, based on current home prices and moderate price increases of 3% each year. They found that more than half (56.8%) of all homes would be less expensive to rent than to purchase.

The study forecasted that in the next ten years, it would be more affordable to purchase more than half (51.2%) of houses and around three-fourths (72.7%) of units nationally, compared to renting.

Paul Ryan, economist for Realestate.com.au, said that the current historic-low rates are responsible for the favorable buying environment.

“Interest rates can currently be fixed below 2% per year and the Reserve Bank of Australia has committed to maintaining low interest rates until at least 2024,” he wrote in the report. “This certainty that mortgage costs are not going to increase rapidly provides comfort to buyers borrowing larger amounts.”

Ryan acknowledged that the greatest barrier to homeownership was the 20% deposit required by buyers.

“Many would-be buyers can already afford loan repayments, but struggle to save a deposit while renting,” he added. “Continued price growth may cause additional concern for many in this position.”

The report provided an overview of the best suburbs for renting or buying a house. The study compared the prices of a three-bedroom house and a two-bedroom unit across Australia’s capital cities.

It is more affordable to rent than buy a home in the top suburbs

Sydney

3-bedroom house
Suburb	AVM median price	AVM median rental	Monthly price differential
Tacoma	$492,782	$435	$578
Rocky Point	$565,283	$450	$388
Warragamba	$532,205	$425	$366
Hamlyn Terrace	$589,461	$455	$338
Warnervale	$644,367	$395	$327
2-bedroom unit
Suburb	AVM median price	AVM median rental	Monthly price differential
Kangy Angy	$198,823	$340	$1,206
Stanhope Gardens	$336,432	$425	$1,148
Vineyard	$252,080	$355	$1,063
Warragamba	$277,249	$353	$973
Banksmeadow	$603,909	$580	$960

Melbourne

3-bedroom house
Suburb	AVM median price	AVM median rental	Monthly price differential
Waterford Park	$379,914	$330	$472
Rockbank	$476,683	$370	$311
Mickleham	$491,077	$380	$289
Millgrove	$457,213	$350	$278
Wollert	$511,142	$390	$266
2-bedroom apartment
Suburb	AVM median price	AVM median rental	Monthly price differential
Frankston North	$419,269	$415	$794
Bangholme	$375,489	$368	$682
Williams Landing	$388,875	$370	$658
Woori Yallock	$363,027	$350	$622
Burnside Heights	$394,018	$363	$563

Brisbane

3-bedroom house
Suburb	AVM median price	AVM median rental	Monthly price differential
Kilcoy	$299,474	$360	$1,014
Lockrose	$267,298	$335	$977
Waterford	$359,110	$375	$890
Toogoolawah	$256,158	$310	$872
Logan Reserve	$372,367	$385	$870
2-bedroom apartment
Suburb	AVM median price	AVM median rental	Monthly price differential
Brisbane City	$508,928	$525	$1,162
Woolloongabba	$428,708	$470	$1,156
Kangaroo Point	$489,224	$505	$1,125
Eight Mile Plains	$372,538	$430	$1,122
Dutton Park	$433,155	$470	$1,119

Adelaide

3-bedroom house
Suburb	AVM median price	AVM median rental	Monthly price differential
Elizabeth South	$168,814	$245	$772
Gawler West	$235,200	$290	$753
Munno Para	$263,004	$310	$748
Elizabeth Park	$223,111	$280	$736
Wingfield	$302,639	$335	$730
2-bedroom apartment
Suburb	AVM median price	AVM median rental	Monthly price differential
Glanville	$242,210	$340	$994
Walkerville	$368,493	$420	$967
Sturt	$226,139	$318	$946
Happy Valley	$209,559	$298	$512
Adelaide	$419,024	$445	$908

Perth

3-bedroom house
Suburb	AVM median price	AVM median rental	Monthly price differential
Hilbert	$287,256	$330	$811
Meadow Springs	$360,369	$370	$730
Lakelands	$324,126	$340	$714
Carramar	$449,931	$420	$693
Stratton	$293,819	$315	$689
2-bedroom unit
Suburb	AVM median price	AVM median rental	Monthly price differential
Wanneroo	$175,417	$355	$1,363
Merriwa	$219,695	$340	$1,135
Coodanup	$123,255	$275	$1,110
Wattleup	$260,214	$365	$1,084
Swanbourne	$736,240	$690	$1,060

Hobart

3-bedroom house
Suburb	AVM median price	AVM median rental	Monthly price differential
Clarendon Vale	$285,250	$365	$993
Gagebrook	$265,480	$340	$930
Risdon Vale	$347,229	$385	$874
Herdsmans Cove	$283,349	$340	$853
Chigwell	$376,246	$400	$842
2-bedroom unit
Suburb	AVM median price	AVM median rental	Monthly price differential
Glebe	$367,388	$495	$1,413
Herdsmans Cove	$225,979	$325	$1,000
Mornington	$356,149	$405	$947
Bridgewater	$236,351	$315	$906
Rokeby	$357,914	$395	$891

Darwin

3-bedroom house
Suburb	AVM median price	AVM median rental	Monthly price differential
Zuccoli	$426,905	$550	$1,449
Muirhead	$498,843	$580	$1,315
The Narrows	$412,274	$515	$1,295
Woolner	$589,819	$603	$1,069
Lyons	$628,005	$605	$924
2-bedroom apartment
Suburb	AVM median price	AVM median rental	Monthly price differential
Darwin City	$363,492	$485	$1,336
Anula	$196,684	$340	$1,204
Rosebery	$260,038	$380	$1,154
Wagaman	$166,040	$310	$1,151
Malak	$194,535	$330	$1,148

Canberra

3-bedroom house
Suburb	AVM median price	AVM median rental	Monthly price differential
Coombs	$591,756	$565	$1,001
Denman Prospect	$588,355	$555	$984
Moncrieff	$598,754	$535	$833
Casey	$607,581	$525	$738
Throsby	$692,715	$580	$696
2-bedroom apartment
Suburb	AVM median price	AVM median rental	Monthly price differential
City	$601,111	$685	$1,634
Reid	$441,282	$540	$1,437
Turner	$531,500	$585	$1,346
Dickson	$501,017	$560	$1,323
Crace	$368,164	$460	$1,291

Renting a house is more affordable than buying one in the top suburbs