Where is it cheaper to have a mortgage than rent?
Recent media coverage based on a joint study by Ubank and Cotality talked about Australian suburbs where making mortgage repayments was cheaper than paying rent.
The study had found some 500 unit markets and 600 house markets across the country where servicing a mortgage would be the cheaper option than paying Australia’s median weekly rent of $659.
Information coming out of the study was generally interesting, informative and might be useful for home buyers and property investors.
The rentvesting sector might also find value in the study’s finding. Rentvesting has been a healthy trend in the real estate scene for some time now and has proved to be an attractive option for those who can’t afford a mortgage where they’d like to live.
The joint study’s research showed that mortgage repayments, along with a 20 per cent deposit, were a cheaper option to renting in 7.7 per cent of Australian suburbs, and gave some examples highlighting capital cities, with Darwin the strongest showing for this trend.
It’s important to do your own research because, taking Brisbane for example, where the median weekly rent sits at $678 and the purchase price equivalent would be $606,000, the study explains that figure is similar to the current median value of houses in Leichhardt and units in Zillmere; but things are not always exactly as it seems.
Zillmere is a suburb in Brisbane, 13.2 kilometres north of Brisbane CBD but Leichhardt is actually a suburb of Ipswich, not Brisbane, and is 46.4 kilometres southwest of Brisbane CBD. Location is a big factor in property decisions.
If you want to read the run down on other capital cities and suburbs, go to https://www.ubank.com.au/newsroom/rentvesting-on-the-rise
Credit: RE/MAX Australia
