In one in 10 suburbs and towns across the country, repayments are less than $200 a week higher than rent, for the typical property. In some suburbs, they are actually cheaper.
I hope someone here who is renting can find a place of their own.
You can’t directly compare renting and mortgaging. A few differences:
What you have after (nominally) 30 years:
- Renting: nothing.
- Owning: secure rent-free accomodation. Can work less and do more of what you enjoy.
Other ongoing costs:
- Renting: moving house every ~1-5 years.
- Owning: building insurance, council rates, water supply, (sometimes body corp fees); (total ~$50-$200/week depending on bushfire/flood risk).
If you’re a keen gardener:
- Renting: time and costs to rebuild then restore to original every time you’re evicted. Uncertain planning timeframes.
- Owning: Go ahead and plant that orchard and have excellent fruit and nuts for the next 30-60 years.
And that’s why people prefer to have their own home, even if it’s an apartment where they can’t plant an orchard.
High rents trap people.
It’s immediately noticeable that the table is very regional/remote heavy, I wonder what percentage of those properties are owned by people living in cities?
I think a lot of those regional/remote ones are skewed by FiFo workers in the mining sector.
Probably a few.
There’s been plenty of articles over the years in the national papers spruiking the best areas to buy into for rental returns. Mining towns are good, especially when they’re in the boom part of their cycle and housing is getting squeezed.
A lot of rental demand in those kinds of regional areas comes from people with a 2 to 5 year plan who don’t want to buy to live “forever” in a social backwater. So a lot of investment property owners can then ride through the “bust” part of the cycle on the backs of those people.
It’s also affected by Universities where there is high demand for rental because of all the students.
For example, suburbs in Vic where renting is more expensive than buying include Melbourne (with RMIT and VU campuses), Carlton (Melb Uni and RMIT), Travancore (near the teaching hospitals, Melb Uni and RMIT Brunswick), and Notting Hill (Monash and Deakin).
That’s not the full picture.
When a person owns a home they have other costs, not just possible mortgage payments. There are rates, insurance, and maintenance. All these together can add up to tens of thousands a year.
Im not in australia but yeah. assesment, mortgage, insurance. Its over a grand a month. Lower than rent for sure but you still have that and only after you pay off your mortgage which is often when you are retired. Moving to a new city for a job becomes that much more complicated. Gotta pay rent in the new place and mortgage plus the rest till you sell. If that happens during a crash then maybe you walk away but then that whole time your monthly cost was over renting and you never got that sweet after payoff deal. Further the renter can put the difference into savings or investments for 30 years.
I own an apartment and there’s not that many costs. I think rates are like $800 a year and the body corp fees are about $900 a quarter
Mortgage (currently) is only about $900 a fortnight. Works out similar to rent overall, except eventually I get to own it.
Renting is a scam and there should be better protections in place. I only managed to buy my apartment because I lived in a vehicle for 4 years while working full time, and the government shared equity scheme owns 25% of it.
if you own an apartment there will be maintenance costs
Congrats on buying your own place. I wish you didn’t have to live in your car to do it but hopefully you never have to again.
Sure, but getting your foot in the door with a mortgage s still a great incentive for many who’d rather sleep on an inflatable mattress on the floor of their own place than rent for ever, especially at the exorbitant rental costs in this country.
I know that Australia is totally different but as a European is crazy to me that I spend around 500€ a year for all the above and you spend tens of thousands
Surely maintenance costs are not that different?
what kind of maintenance do you actually need? I do very little in terms of maintenance, and most of that is just free. Cleaning mostly (radiators, windows, boiler, appliances filters and descaling) and checking (RCD switch test). Painting every 5 years on walls and exterior wood and trim is cheap, as is checking fixing the silicon sealants. I cannot think of anything else: usually in europe we have smaller houses with no garden made of masonry. We do not need to worry as much about UV or termites.
wiring, plumbing, foundations, roofs, heating, cooling etc
Why do you need to do maintenance on the wiring and the plumbing? Those are things you repair if needed once every 20 years maybe. I had to replace an RCD switch for 20$ last year and that’s it. Foundations and roofs you do not touch like ever, I lived in a house that got no foundations maintenance in 600 years. For heating maintenance you need to bleed the radiators and cleanup the aircon radiators and filters, both of which are free.
EDIT: I mean, this probably is just part of the wood vs masonry difference. Probably wood houses are just more expensive to maintain
