Mortgage repayments are now cheaper than rent in some Australian suburbs. Is yours among them?

Buying and renting costs are getting closer

High rents and softer property prices have narrowed the gap between renting and buying in parts of Australia.

Analysis of Cotality data found that in one in 10 suburbs and towns, typical mortgage repayments were less than $200 per week higher than rent. In some areas, estimated repayments were lower than the median rent.

Australia’s median rent increased 5.5% over the year to September, reaching $713 per week, while median property values across houses and units were broadly unchanged over the same period.

Melbourne suburbs stand out

The typical Melbourne apartment rent was $628 per week.

Based on a median apartment value of $624,740, estimated weekly mortgage repayments were $839.

However, repayments were estimated to be lower than rent for typical properties in Carlton, Melbourne CBD, Notting Hill, Travancore and Southbank.

How the comparison was calculated

The analysis assumes a new 30-year home loan equal to 95% of the property value, with an interest rate of 6.2%.

It does not include additional property ownership costs, meaning individual circumstances may produce different results.

In parts of Sydney and Canberra, the gap between typical rent and estimated mortgage repayments was also relatively small.

For eligible first-home buyers, government low-deposit schemes may assist with purchasing with a 5% deposit, subject to eligibility requirements.