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Renting Versus Buying

There are many different things to consider when deciding whether to rent or buy a property. Whether you are first moving out of home or if you have been renting for a while, we explore some of the questions you may want to ask yourself.

You will have greater flexibility to move out earlier if you are renting, for example if you wanted to spend time travelling overseas or move to a different suburb.

Costs involved
If you elect to rent, extra costs to consider may include an upfront bond and payment of one month’s rent in advance. Rent may be less than the cost of mortgage repayments, particularly if you are sharing the rent with a partner or friends. There are many extra costs to consider when purchasing a property, which can include your deposit, stamp duty (this has recently been abolished for first home buyers purchasing a property in Victoria valued below $600,000), pest and building inspection, loan establishment fee, lenders mortgage insurance, council and water rates, bank valuation fee and solicitor costs.


You may be forced to move out early if you are renting, as there is no certainty that your landlord will renew the lease. If you own the property, you can live in it for as long as you wish.


Many landlords do not allow pets to live at the property so it’s always best to check first.

Changes to the property
If you are renting, permission to make any changes to the property (from hanging artwork to installing a new oven) will be required from the landlord first, meaning that they are more difficult to make. If you own the property, the decision to make changes is yours and future renovations are a possibility, subject to council and future lending approval (if applicable).


If the value of a property you own increases, you may make a profit if you decide to sell it. Principal and interest mortgage repayments, combined with the property value increasing, also mean that you may be able to use the equity that you have in the home to increase your home loan for your next purchase, such as a new car, subject to eligibility. As home loan interest rates are generally lower than car loan interest rates, the lesser repayments will save you money.


If living in the inner city is an important factor, it is often more affordable to rent than to buy. Another option is to buy an investment property in an affordable area, whilst continuing to rent in the area that you wish to live in, so that you have the best of both worlds.

Future plans and financial goals
It’s important to consider your future plans such as family and investment goals, as well as your current situation when deciding whether to rent or buy. If you would like to speak with an expert to discuss your options in more detail call us on 1300 654 822.