Queensland, Tasmania and Western Australia have the highest proportion of units and houses that are cheaper for buyers, new PropTrack data found. In Western Australia, a staggering 78 per cent of homes are cheaper to buy than rent.
PropTrack economist Paul Ryan said this reflected recent unit development, with new unit prices low compared to rents following record rent growth.
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“Favourable buying conditions remain despite a record pace of interest rate increases, and home prices increasing 36 per cent since the pandemic. This shows that there are still opportunities for buyers across the housing market,” Ryan said.
“A record pace of rent growth – with advertised rents up 14.6 per cent over the past year – has offset higher buying costs in many regions.”
Units provided the most opportunity, with 55 per cent of these properties cheaper to buy than rent, compared to 29 per cent for houses.
Victoria had the lowest proportion of homes that were cheaper to buy than rent at 16.6 per cent, followed by NSW at 24.3 per cent. But this could vary significantly depending on the suburb.
The research is based on the cost of owning or renting each home for the next 10 years, including mortgage costs and other related costs, including stamp duty, rates and maintenance.
Here’s a city-by-city breakdown of the locations with the highest share of homes that are cheaper to buy than rent.
Botany - 71 per cent
Auburn - 63 per cent
Parramatta - 55 per cent
Melbourne City - 83 per cent
Stonnington West - 48 per cent
Port Phillip - 47 per cent
Brisbane inner - 80 per cent
Beenleigh - 78 per cent
Brisbane inner north - 62 per cent
Playford - 84 per cent
Gawler Two Wells - 65 per cent
Salisbury - 65 per cent
Kwinana - 95 per cent
Gosnells - 95 per cent
Swan - 93 per cent
Hobart North West - 70 per cent
Brighton - 68 per cent
Sorell Dodges Ferry - 38 per cent
Looking to 2024, Ryan noted that higher interest rates would challenge housing affordability for many Aussies.
“This may slow price growth and rebalance buying conditions across the market,” he said.