For some Australian renters, buying a home is becoming a more realistic option as rents rise and property prices flatten. An analysis of Cotality data by Guardian Australia found that mortgage repayments are now lower than rent for typical properties in some suburbs, while in many other areas the weekly gap has narrowed.
Australia’s median rent rose 5.5% in the year to September, reaching $713 a week, according to the data cited in the report. Over the same period, the median price of houses and units remained broadly flat after six months of steady falls. The figures suggest that the relationship between renting and buying is shifting, although a mortgage is still more expensive than rent in most locations.
In Melbourne, the typical apartment rent was $628 a week after rising 4.8% over the year. Estimated mortgage repayments on a typical flat were $839 a week, about $211 more than rent, based on a median value of $624,740 in September. The analysis assumed a new 30-year loan covering 95% of the property value at an interest rate of 6.2%, and did not include additional ownership costs.
The analysis found repayments were lower than rent for a typical property in several Melbourne suburbs, including Carlton, Melbourne’s CBD, Notting Hill, Travancore and Southbank. In Sydney, the weekly difference was about $100 in suburbs including Ultimo, Warwick Farm, Rosehill, Liverpool and Granville. In Canberra’s Belconnen and Phillip, repayments were less than $75 a week above rent, with several apartment-focused suburbs also close to that level.
Darwin stood out, with buying estimated to be cheaper than renting in around a quarter of suburbs. Rents there had risen 11.6% over the year, according to Cotality data cited by The Guardian. However, researcher Gerard Burg said some of the areas where buying appeared cheaper were mining and resource-project locations, where workers often rent temporarily rather than purchase a home.
Burg said areas with substantial apartment construction can become relatively affordable to buy when extra supply puts downward pressure on purchase prices, while rental availability remains tight and rents rise. He cautioned that these locations are exceptions, and that houses generally remain more expensive to buy than rent.
Mortgage broker Clint Waters said interest in buying had eased, but renters were making enquiries as they compared lower property values with rising rents. Some were also asking whether they could buy the property they already rented, potentially allowing them to become homeowners without moving.
The calculations should not be treated as a complete comparison of the cost of owning and renting. The report’s mortgage estimates exclude expenses such as council rates, insurance, maintenance and other ownership costs. Buyers with larger deposits would generally need smaller loans and could face lower repayments, while borrowing capacity, deposit requirements and eligibility for government assistance vary between households.
The analysis also assumes a 5% deposit, which may require eligible first-home buyers to use a government-backed low-deposit scheme. Interest-rate changes can shift the comparison quickly: the report noted that higher interest rates had offset some of the effect of lower property values on repayments over the previous year.
For renters considering a purchase, the figures suggest it may be worth comparing local rents with realistic mortgage estimates rather than relying on national averages. But a smaller weekly gap does not automatically make buying affordable. Upfront costs, lending approval, ongoing maintenance and the risk of future rate rises all matter, and the suburbs where repayments are below rent remain unusual rather than the national norm.
