Quick Look
Focus – Weighing up whether renting or buying makes more sense for your goals, lifestyle and budget
Key Takeaways:
It’s one of the biggest financial questions Australians face: should you keep renting, or take the plunge and buy a home?
With rising interest rates, tight rental markets, and shifting property prices, the answer isn’t one-size-fits-all. The right move depends on where you are in life—and what you want your money to do for you.
This guide breaks down the pros and cons of each path so you can feel more confident about your next step.
In 2025, buying a home remains challenging for many Australians due to high prices, lending constraints and elevated borrowing costs.
At the same time, rents remained high and were still rising in many areas in 2025—especially major cities and regional hotspots. So, neither option feels easy.
But looking beyond short-term market conditions, the real question is: which option better suits your current goals and future plans?
1. Costs and Cash Flow
Buying Example (NSW):
Renting Equivalent:
Similar property might rent for: ~ $650/week = ~ $2,800/month
So, buying may cost $1,000+ more per month—but some of that goes toward building equity.
2.Flexibility vs Stability
Renting
Easier to move suburbs, cities or even interstate More affordable to live at better locations–only live once No control over rent increases, lease terms or continuation
Buying
Can renovate, stay long-term, and gain security Build equity over time Harder to sell or move quickly
What About Renting While Buying
Build equity over time with negative gearing (see other article in this library)Depends on overall cost of renting plus investing No control over rent increases, lease terms or continuation
3. Wealth Building
Renting
Buying
Tip: Buying becomes more appealing if you plan to stay put for 7+ years—long enough to ride out market ups and recover up front costs
Is renting a waste of money?
Not necessarily. Rent gives you a place to live—just like a mortgage. The key is whether you’re also saving and investing the difference.
Is buying always better long - term?
Often yes—but only if you stay long enough to cover the costs and benefit from growth. Selling too soon can erase gains. Alternatively, you can keep the property and rent it out while you rent at your new place.
Will interest rates drop soon?
Nobody knows for sure. Base your decision on what you can afford now, not on predictions.
Can I rent but still build wealth?
Absolutely—through super, shares, or investment property. But it requires a plan and discipline.
There’s no universal rule for renting or buying—just the path that works best for your circumstances right now.
If you value flexibility and lower upfront costs, renting could be a smart choice. But if you’re ready to settle and build long-term equity, home ownership may make more sense—even if it stretches your budget early on. And it’s especially important to have a debt free home when you retire because owning your home outright by retirement can significantly reduce living costs and improve financial flexibility.
Whichever way you lean, having a clear financial strategy will always put you ahead.
Considering property investment?
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Disclosure: General information only. Consider your objectives, financial situation and needs, and seek professional advice before acting.
Disclaimer: All information on Super Advice Ai is general in nature only and does not take into account your personal objectives, financial situation or needs. You should consider whether any information on Super Advice Ai is appropriate to you before acting on it. If Super Advice Ai refers to a financial product, you should obtain the relevant Product Disclosure Statement (PDS) or seek professional advice from a licensed financial planner.
