- It is cheaper to service a mortgage than rent across over 30% of Australian property
- Flexible and hybrid work options have influenced property buying decisions
- All capital cities have unit and house markets where it is cheaper to buy than rent
Outer-metro suburbs and inner-city apartments provide some of the best opportunities for Australians to buy or invest in a home that is cheaper than renting, according to data from NAB.
Andy Kerr, NAB Executive Home Ownership, said through the pandemic, the abundance of flexible and hybrid work options have influenced buyers – especially first home buyers – when deciding what properties to purchase.
“Our research shows prospective buyers shift in where they want to buy and demand from first home buyers has been the strongest we’ve seen in a generation,” explained Mr Kerr.
“Property prices have not risen as much in outer-metro suburbs and first home buyers are very good at picking up on where property prices have been more subdued. The correlation between outer-metro suburbs and buying new builds is certainly playing through in finding a bargain.
Andy Kerr, NAB
“House prices are rising but there’s still plenty of opportunities for Australians to buy their dream home rather than rent it. The simple reason for this is the record low rates on offer, with many mortgage rates still coming with a 2 in front of them.”
Areas where it’s cheaper to buy than rent
Brisbane: areas in the outer suburbs, especially north and west of Greater Brisbane, such as Logan, Bald Hills, Redbank Plains, Redcliffe and Caboolture all provide opportunities for buying a house over renting.
“In contrast, several unit markets that provide opportunities where it is cheaper to buy than rent, are found within a three-kilometre radius of the Brisbane CBD,” the report said.
“Areas such as Brisbane City, Fortitude Valley, Spring Hill, and South Brisbane are all unit markets where it is cheaper to service a mortgage than rent. Outer unit markets such as Chermside, north of Brisbane also present a range of more affordable opportunities.”
Perth: house locations include Armadale, Greenfields, Port Kennedy, Clarkson and Baldivis. In terms of units, Perth CBD, East Perth, South Perth, Rivervale, Maylands and Fremantle all remain cheaper to buy than rent based on median unit value.
Adelaide: houses in the outer north such as Elizabeth and Salisbury are cheaper to buy than rent. For the unit market, areas include Adelaide CBD, Glenelg and Mawson Lakes.
Hobart: only Glenorchy units provide a cheaper opportunity to buy than rent. Areas popular with first home buyers such as Sorell, Howrah, Moonah and Kingston have houses cheaper to buy than rent too.
Darwin: suburbs such as Zuccoli, Gunn, Durack and Leanyer all have houses more affordable to buy. Units in Darwin City, Stuart Park and Larrakeyah all have significant unit stock that provides an opportunity to buy over renting.
Canberra: housing markets such as Kambah, Ngunnawal and Bonner all provide more affordable buying solutions over renting.
Sydney: areas in the outer-west and north-west provide opportunities thanks to higher volumes of units. Campbelltown, Liverpool, Blacktown and Penrith all have units cheaper to service a mortgage compared to renting.
Melbourne: the trend is similar with the unit-driven suburbs such as Carlton, Melbourne CBD, Southbank, Docklands and Abbottsford all providing opportunities for buying over renting, as does suburban unit markets such as Bundoora.
Melton and Melton South, on the outskirts of Greater Melbourne, all provide some of the more affordable housing options over renting.