Rent vs Buy Calculator for Australia

Rent vs buy calculator Australia: how do you use it?

Enter the price, your weekly rent converted to a monthly figure, the interest rate you’d actually pay, and buying costs that include stamp duty for your state. On our Australian defaults, buying only edges ahead after about eight years, and that depends on prices rising 5% a year; at the higher rates new borrowers faced in late 2026, renting and investing finishes ahead over a decade.

The calculator models every month. Buyers pay the deposit, stamp duty and fees upfront, then loan repayments, council rates, maintenance and building insurance. Renters pay rent and contents insurance, invest the money the buyer used for the deposit and costs, and invest any monthly saving. At the end, the buyer sells and pays agent and conveyancing fees. See our methodology for how each cost is treated.

Why our Australian defaults are set this way

A note on rates: the Reserve Bank of Australia raised the cash rate to 4.85% on 3 November 2026, its fifth increase of the year and the highest level since 2008. Most new variable loans are now priced above 6%. Our 5.6% default sits below what many new borrowers pay, so replace it with your lender’s rate — a 6.4% rate is a sensible stress case.

Worked example: renting vs buying a A$900,000 home

Upfront: A$180,000 deposit plus A$40,500 in costs = A$220,500. The renter invests that amount.

Monthly repayment: a A$720,000 principal-and-interest loan at 5.6% over 30 years costs A$4,133 a month. About A$40,000 of the first year’s repayments is interest.

Owner running costs: council rates (A$225), maintenance (A$750) and building insurance (A$150) add about A$1,125 a month. Owning costs about A$5,260 a month in year one versus about A$2,815 to rent. The renter invests the difference — roughly A$2,440 a month.

After 10 years: buying finishes narrowly ahead, by around A$17,000, with a break-even year of about eight. The break-even rent is about A$2,710 a month (roughly A$625 a week): if you can rent an equivalent home for less, renting wins.

Change one input and it flips: at a 6.4% rate, the repayment rises to about A$4,504, renting pulls ahead by around A$59,000, and the break-even rent climbs to about A$3,090 a month (about A$715 a week). Drop price growth from 5% to 4% and renting also wins.

The 5% rule shows why it’s tight: A$900,000 × 5% ÷ 12 = A$3,750, well above the A$2,800 rent, so on the quick test renting looks cheaper. Buying only catches up through strong capital growth.

What does it cost to buy and sell a home in Australia?

Stamp duty is calculated on the full price under each state’s scale, and the thresholds change. Use your state revenue office’s calculator and add the result to buying costs.

The 5% Deposit Scheme and LMI

Lenders usually charge lenders mortgage insurance when you borrow more than 80% of the value. LMI protects the lender, not you, and it’s often added to the loan. The government’s 5% Deposit Scheme, run by Housing Australia, removes the need for LMI on eligible purchases. From 1 October 2025 it was expanded: income caps and limits on places were removed, and property price caps were raised — reported caps include A$1.5 million in Sydney, A$950,000 in Melbourne and A$1 million in Brisbane. Buyers must be Australian citizens or permanent residents buying a home to live in.

With a 5% deposit on our default home, the loan is A$855,000 and repayments are about A$4,908 a month at 5.6%. The renter starts with far less to invest, which tends to help the buyer, but you carry more debt and more rate risk. Test it in the calculator before you commit.

Taxes, negative gearing and owner-occupiers

Negative gearing is irrelevant to an owner-occupier’s decision. It lets property investors deduct losses, including interest, against their income. If you buy a home to live in, your interest isn’t deductible. What you do get is the main residence exemption from capital gains tax, so any gain when you sell your home is usually tax-free. The calculator doesn’t model tax, which fits owner-occupiers well.

Negative gearing still matters indirectly: investors who can deduct losses compete for the same homes, which is part of why rental yields in Sydney and Melbourne are low. That is one reason “rentvesting” — renting where you want to live and buying an investment property elsewhere — is common in Australia. Our rent and invest vs buy calculator focuses on the investing side.

Other help for first home buyers includes the First Home Super Saver scheme, which lets you save part of a deposit through voluntary super contributions, and first home owner grants for new homes in most states.

How do Sydney, Melbourne, Brisbane, Perth and Adelaide compare?

• Sydney: our Sydney preset uses A$1.45 million and A$800 a week. Stamp duty is large unless you qualify as a first home buyer, and gross yields are among the lowest in the country, so renting often wins unless prices keep growing strongly.
• Melbourne: price growth has lagged Sydney and Brisbane in recent years, and Victorian stamp duty is high. Many Melbourne buyers are closer to break-even than they expect; test lower growth, such as 3–4%.
• Brisbane: strong recent price growth and rising rents. First home buyers purchasing new homes pay no transfer duty, which removes a major cost.
• Perth: lower prices relative to rents than the eastern capitals and fast recent growth. Buying often breaks even sooner.
• Adelaide: moderate prices and tight rental markets; buying tends to look favourable over longer stays.

Apartments have different economics from houses. Strata levies, slower price growth and higher supply often favour renting; see buying a condo vs renting for the trade-offs.

When does renting win vs buying in Australia?

Renting tends to win when:

• You expect prices to grow below about 4% a year in your area.
• Your loan rate is above 6% and you’ll invest the difference.
• You’re buying an apartment with high strata levies.
• You may move within five years, before stamp duty is recovered.

Buying tends to win when:

• You’ll stay 10 years or more and expect solid long-term price growth.
• You qualify for a stamp duty exemption or the 5% Deposit Scheme.
• Rents are rising quickly and vacancy rates are tight.
• You value security of tenure, given that leases are usually only six to 12 months.

Australian rent vs buy checklist

Our guide to the rent vs buy break-even point explains why the break-even year moves so much with these inputs.

1. Convert weekly rent to monthly (× 52 ÷ 12).
2. Calculate stamp duty for your state, price and first-home status.
3. Use a current rate from your lender, not the default.
4. Add LMI, or set a 5% deposit if you’ll use the government scheme.
5. Look up council rates and add strata levies for units.
6. Test price growth at 3%, 4% and 5% to see how much the verdict depends on it.
7. Compare the break-even rent with listings for comparable homes.

The calculator is for general information, not financial advice; speak to a licensed broker or adviser about your situation.

This calculator is for education and planning. It is not financial advice. Defaults for Australia are illustrative late-2026 estimates; check current rates and fees locally.