CoreLogic’s head of residential research, Eliza Owen, has penned interesting research comparing the cost of renting versus buying across Australia’s capital cities. This research finds that renting is generally cheaper in Sydney and Melbourne, whereas the reverse is true in Darwin and Hobart:
Methodology:
- Mortgage serviceability is based on an 80% loan-to-value ratio loan (i.e., it assumed the buyer has been able to save a 20% deposit). The assumed mortgage rate is 3.23%, as per the latest RBA lending rate statistics for all owner-occupiers across all institutions.
- No mortgage fees, or transaction fees are assumed. The loan value is derived at the individual property level, where rigorous AVM values were used.
- Rental repayments are based on the CoreLogic rental AVM, at an individual property level.
- Calculations are based on valuations taken at 24th February, 2020.
