SA housing: where renting is better than buying on $2000+ per week – realestate.com.au

Do you think rent money is dead money? Think again.

New Finder research shows that of the 516 suburbs or towns in South Africa for which house or unit data is available, in only 25 of them is it cheaper to pay a mortgage than a weekly rent.

According to the data, the biggest savings from renting can be found in South Africa’s most prestigious suburbs, with Medindie, on Adelaide’s northern edge, leading the way.

Here the average rent – ​​for a $3.365 million home – is $1315 per week, while mortgage repayments are $3535.

This is a savings of $2220 per week, for the exact same lifestyle.

Renters at Unley Park saw similar savings: here you’d be $2,075 a week better off renting, while in Toorak Gardens you’d pay $2,013 more in mortgage repayments than the weekly rent.

Finder’s head of consumer research Graham Cooke said it was tempting to look at the suburbs where a mortgage is cheaper than rent and assume the property ladder is within reach, but for most suburbs renting remains the cheaper option.

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“Even in the rare cases where the math is reversed, the calculations don’t take into account the deposit you need to save, stamp duty and all the other costs involved in buying a house,” he said.

“The reality is that for most young Aussies, especially those in the capital cities, the dream of home ownership is being squeezed on both sides.

“Negative gearing ensures that the gap between house prices and rental costs will persist for the foreseeable future.”

He said low deposit schemes are touted as a solution, but they also come with a hidden sting: Borrowing more could mean higher interest costs that would disqualify about half of “affordable” suburbs from this analysis.

Graham Cooke, head of consumer research at Finder.

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“We have reached the point where the enormous cost of entry, combined with the rising cost of debt, is putting the property ladder largely out of reach for many Australians,” he said.

For those looking to get off the rental roundabout, the biggest savings can be made in Tonsley, in Adelaide’s south, where weekly repayments on an average-priced unit are $431, compared to their average rental price of $625 – a saving of as much as $194 per week.

All the remaining areas where it is cheaper to buy than to rent are in regional South Australia, with the next biggest savings in Coober Pedy homes where mortgage repayments – of just $84 per week – are $179 cheaper than rents.

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The homes in Peterborough, Roxby Downs and Port Pirie West, and Whyalla Norrie units, all offer weekly savings of more than $100 per week to those who buy rather than rent.

Samuel Paton of Ray White Marion said Tonsley is a rarely discussed gem that should be on buyers’ list if they want an easy lifestyle at a reasonable price.

“It’s a fantastic choice for first home buyers looking to enter the market and an even better choice for investors,” he said.

Ray White Marion agent Samuel Paton. Delivered

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“The demand for rental properties in the area is high, the vacancy rate is almost zero and the returns are fantastic.”

The report assumed a loan term of 30 years, a deposit amount of 20 percent and an average outstanding variable interest rate for owner-occupied homes of 5.52 percent per month.

– with Aidan Devine