Let’s be frank: this is not the first time young Australians have whinged that property prices in Australia are becoming unaffordable.
For decades, people have complained that the cost of buying a house is too high. Back in the 80s, my own mother remembers laughing when her landlord offered to sell her the three-bedroom home she was renting for $22,000. Earning just $80 per week, that property price “might as well have been $1m” to her at the time.
Today, many first homebuyers are quite literally looking at a $1m price tag when shopping for their first home. It’s leading many of us wondering whether we’ll be stuck on the rental roundabout for decades, rather than years…
But there is hope!
We’ve done a little research to uncover a handful of locations around the country, where it’s actually cheaper to buy your own home than it is to rent. Hopefully this gives you a helpful dose of inspiration to sniff out your own affordable abode!
The Real Estate Institute of Victoria has crunched the numbers and found 8 suburbs where renting will eat through substantially more of your pay packet than buying will.
REIV CEO Geoff White, who adds that these figures include the mortgage repayments only, says, “One- and two-bedroom apartments allow first homebuyers to get a foothold on the property ladder for about the same amount they are currently paying in rent.”
These affordable suburbs are well located near the CBD, too; they include:
|Suburb||Dwelling Type||Weekly Mortgage
Rent (Jun 2016)
|NOBLE PARK||1-bedroom unit||$195||$215||$185,000|
|MELTON SOUTH||4-bedroom house||$305||$320||$290,000|
Across broader Sydney, the median rent is $595 per week, report CoreLogic in its Rental Index results (July 2016).
With a 10% deposit and assuming a 4% mortgage interest rate, your weekly mortgage repayment would be around $585 on a property priced at up to $675,000.
So what can $675k buy you in Sydney right now?
The median rent across Brisbane is $429 per week, according to the CoreLogic Rental Index results (July 2016).
With a 10% deposit and assuming a 4% mortgage interest rate, your weekly mortgage repayment would be around $425 on a property priced at up to $490,000.
This means a number of inner city apartments in Brisbane could be more affordable to pay a mortgage than to pay a landlord, including:
Keen to buy a property, but don’t have enough deposit yet? Consider pooling your resources and buying with friends.