Melbourne Suburbs Where It’s Cheaper To Buy Than Apartment
SMALL units in a host of Melbourne suburbs are cheaper to buy than rent, making them ideal targets for first-home buyers, new data reveals.
Realestate.com.au research shows it would cost $2516 less annually to pay off the average mortgage for a two-bedroom unit in Travancore than it would to rent one.
It’s a similar story in Albion, where buyers of two-bedroom units are $2463 better off yearly than renters.
This property type is ultimately also cheaper to buy than rent in Melton, Melton South, Notting Hill and the CBD, according to realestate.com.au.
Three-bedrooms units in Wallan and Melton South also fit this category, along with two-bedroom houses in Roxburgh Park.
Realestate.com.au compared the monthly loan repayments needed on a median-priced home to the suburb’s average monthly rent to calculate the data.
The repayment figure was based on the buyer having paid a 20 per cent deposit and signed up for a 30-year mortgage with a 5.25 per cent interest rate
According to realestate.com.au, buyers currently only pay an extra $6.15 per month on monthly loan repayments compared to monthly rent for two-bedroom units in Broadmeadows, making this property type another solid proposition for househunters.
Buyers also needed to shell out only a little bit more a month than renters for three-bedroom units in Meadow Heights and Melton, $7.94 and $20.97 respectively, and two-bedroom units in Bacchus Marsh and Sydenham, $21.92 and $26.97.
Realestate.com.au chief economist Nerida Conisbee said these were the types of properties first-home buyers should have in their sights, as once they’d overcome the challenge of saving a deposit, the repayments should be achievable.
She said a mix of affordable median prices, new unit development and a lack of investors, and therefore rental properties, had made these areas better prospects for buying than leasing.
The benefits of owning property including earning equity, making it “easy to upgrade down the track”, enforced saving to meet repayments, and not having to answer to a landlord, Ms Conisbee said.
“People do like to have control of their home and be able to improve it,” she said.
LJ Hooker Wallan agent Wayne Dent said renting was “easily more expensive than buying” in the town, 45km north of the CBD.
He said there had been fewer units built in the area in the past year, decreasing the available rental stock and pushing up prices.
Pagan Real Estate Travancore director Ryan Pagan said the State Government’s recently introduced stamp duty concessions for first-home buyers had boosted interest in the suburb’s apartments.
Mr Pagan said his office had sold almost 40 units in the past month alone. Those with two bedrooms cost between $330,000 and $370,000 on average, and were being rented for about $380 to $400 a week.