The big Australian question

Rent or buy?

The honest version: not just the mortgage, but stamp duty, ownership costs, and what the renter could earn investing the difference. See who's actually ahead — and by how much.

Rent vs buy calculator

Compares your total wealth after a set time if you buy, versus if you rent the same place and invest the difference.

Home price

Deposit

Rent for the same place / wk

State / territory

Years you'll stay

Home growth / yr (%)

Over 10 years, you'd be roughly

$17,174

better off by renting & investing — though that's close enough to call a draw.

Renting wins

Your wealth after 10 years

If you buyhome equity + savings, after sale

$619,002

If you rentdeposit + savings, invested

$636,176

Upfront to buy

$192,687

20% deposit + costs

Stamp duty

$30,187

New South Wales

Mortgage

$3,837/mo

P&I, 30-yr loan

Home value at 10yr

$1,184,195

from $800,000

Total rent paid

$392,779

over the period

Total interest

$356,043

if you buy

Modelled monthly in nominal dollars: home growth 4% / yr, rent growth 3% / yr, investments 7% / yr, ownership costs 1.1% of value / yr, 2.5% selling costs, 6% mortgage. The renter invests the deposit and any monthly saving; the buyer's wealth is home equity net of selling costs. Rent vs buy is hugely sensitive to growth and how long you stay, and this ignores tax, negative gearing and first-home grants. A guide, not advice.

Your assumptions

Home growth / yrset above

Rent inflation / yr%

Investment return / yr%

Mortgage rate%

Ownership costs / yr% of value

Selling costs% of sale

Buying costs$

Home growth, deposit, price, rent, state and horizon come from the calculator above. Change any assumption and every table below re-runs the same model instantly.

Show in today's dollars

Discount future wealth for inflation, so the 10-year figures are in money you understand now.

On these assumptions, after 10 years

Renting & investing is ahead by $17,174

Renting wins

Year by year — your wealth if you sold up and walked away

Year	If you buy	If you rent	Difference	Ahead
1	$179,059	$227,701	$48,641	Rent
2	$219,851	$264,471	$44,620	Rent
3	$262,456	$303,103	$40,648	Rent
4	$306,957	$343,711	$36,754	Rent
5	$353,441	$386,414	$32,973	Rent
6	$402,002	$431,342	$29,340	Rent
7	$452,735	$478,630	$25,896	Rent
8	$505,741	$528,426	$22,685	Rent
9	$561,126	$580,886	$19,760	Rent
10	$619,002	$636,176	$17,174	Rent

Renting stays ahead across all 10 years on these assumptions — buying never catches up within your horizon.

Cash you need on day one

Deposit20% of the price	$160,000
Stamp dutyNew South Wales	$30,187
Buying costsconveyancing, inspections, loan setup	$2,500
Total upfront	$192,687

The renter starts by investing this same $192,687 instead of tying it up in property.

Money that never comes back — over 10 years

If you buy
Mortgage interest$3,837/mo repayment	$356,043
Ownership costsrates, insurance, maintenance, strata	$107,577
Stamp duty + buying costspaid upfront, never recovered	$32,687
Selling costs at exit2.5% of sale price	$29,605
Total dead money	$525,912

If you rent
Total rent paidgrows each year with inflation	$392,779
No stamp duty, interest, maintenance or selling costs.
Total dead money	$392,779

The buyer's $104,412 of principal repaid isn't dead money — it turns into home equity. That's why owning can win even when the dead-money totals look close.

How your wealth at year 10 is built

Buyer
Home value at year N	$1,184,195
Less loan still owing	− $535,589
Equity	$648,607
Less selling costs	− $29,605
Plus side investments	$0
Buyer wealth	$619,002

Renter
Upfront cash invested	$192,687
Plus monthly savings vs buyer, grown	$443,489
Renter wealth	$636,176

The long game — when buying overtakes renting

Break-even to buy

40+ yrs

never within 40 yrs

Your horizon

10 yrs

years you'll stay

Verdict at 10 yr

Rent

$17,174 ahead

Buyer wealthRenter wealthwealth if you sold and walked away, by exit year

Renting stays ahead the whole 40 years on these assumptions — the upfront costs and the $392,779 of rent still never let buying catch up.

Sensitivity — buy-vs-rent gap at year 10

How much better off you'd be at your 10-year mark if home growth (down) and your mortgage rate (across) landed elsewhere. Green = buying wins, blue = renting wins; deeper shade = bigger gap.

Growth ↓ / Rate →	5%	5.5%	6%	6.5%	7%
2%	−$124k	−$166k	−$208k	−$251k	−$294k
3%	−$33k	−$75k	−$117k	−$160k	−$203k
4%	+$67k	+$25k	−$17k	−$60k	−$103k
5%	+$176k	+$134k	+$92k	+$49k	+$6k
6%	+$295k	+$253k	+$211k	+$168k	+$125k

The outlined cell (4% growth, 6% rate) is your scenario above. The colour flips far more as you move down the rows than across the columns — capital growth swings this decision much harder than the mortgage rate does.

Everything above is the same monthly, nominal-dollar model as the headline, re-run with your assumptions on a 30-year loan. The renter invests the upfront cash plus any month where owning would cost more than rent; the buyer invests any surplus once their housing cost drops below rent. Excludes tax, negative gearing and first-home grants. A guide, not personal advice.

Comparing a weekly rent to a monthly repayment tells you very little. What decides this is the money neither path gets back — stamp duty, interest, rates, insurance, maintenance and the agent's cut on the way out, against the rent a tenant pays — plus what the deposit could have earned elsewhere.

It usually turns on how long you stay rather than the price. Buying starts with a large unrecoverable cost that growth has to earn back before you're ahead, so the same purchase can be wrong at three years and right at fifteen. The number worth finding is the break-even year in the deep-dive panel.

How this is calculated

1
Price the day-one cash for buying
Your deposit, plus transfer duty on your state's owner-occupier scale, plus a flat allowance for conveyancing, inspections and loan setup. That total is the buyer's upfront outlay — and the exact sum the renter invests instead.
2
Run both housing costs, month by month
The buyer pays a principal-and-interest repayment on the price less the deposit over a 30-year term, plus yearly ownership costs set as a percentage of the home's current value: rates, insurance, maintenance, strata. The renter pays rent, lifted monthly at the rent-growth rate.
3
Invest the difference, whichever way it falls
Each month the cheaper path invests the gap at the investment return. Early on that is the renter, whose housing bill sits well below a new mortgage; later, as rent climbs past a repayment that doesn't, the buyer builds a side portfolio instead.
4
Compare the wealth at your horizon
The home compounds monthly while each repayment splits into interest on the balance outstanding and principal that reduces it, so equity builds slowly at first. Buyer wealth is the end value less what is owing, less selling costs, plus any side portfolio; renter wealth is just the portfolio.

What it assumes

No tax on either side: no capital gains tax on the renter's portfolio, no negative gearing, no franking credits. Both figures are pre-tax, and the two paths aren't taxed alike.
No first-home concessions or grants — full transfer duty is charged, so an eligible first home buyer pays less upfront than modelled and buying looks better than shown.
Lenders mortgage insurance isn't added, though a deposit below 20% of the price would normally attract a premium on top of the upfront cash.
The buyer is assumed to sell at the end, so selling costs are always deducted — if you plan to stay well beyond your horizon, buying is penalised slightly.
Figures are nominal future dollars, though the deep-dive panel can discount them to today's money at an inflation rate you set.
Growth rates are assumptions, not forecasts, and the verdict is more sensitive to them than to anything else — the sensitivity grid shows how fast the winner flips.

Common questions

Isn't rent just dead money?

Rent is money you don't get back — but so is mortgage interest, stamp duty, rates, insurance, maintenance and the agent's commission when you sell. Only the principal part of a repayment builds equity. The advanced panel totals the unrecoverable costs on both sides.

How long do I have to stay before buying wins?

That's the break-even year in the deep dive: the model re-runs for every exit year and flags the first where the buyer passes the renter. Short stays are punished because duty and selling costs spread across fewer years of growth.

Why does the answer flip when I nudge home growth by one per cent?

Leverage. Growth applies to the whole value of the home even though you put down a fraction of it in cash, while the renter's return applies only to what they invested.

Does it account for capital gains tax on the renter's shares?

No — neither side is taxed here, so the renter's portfolio is a pre-tax figure. Shares sold at a gain and a home you have lived in are treated very differently under Australian tax law, which matters when the result is close.

Renting wins, but I want somewhere secure to live. Now what?

Treat the number as one input, not a verdict. It prices dollars only: not a lease you can't be moved from, nor the forced saving a mortgage imposes — and it assumes the renter invests every dollar they save.

Sources: Revenue NSW — Transfer duty · SRO Victoria — Land transfer duty · RBA — Interest rate statistics · ASIC MoneySmart — Home loans · All data sources

General information only, not financial advice. Figures are estimates based on the inputs and assumptions above and don't account for your personal circumstances. Confirm anything important with the relevant authority or a licensed adviser.

How this is calculated

Price the day-one cash for buying

Run both housing costs, month by month

Invest the difference, whichever way it falls

Compare the wealth at your horizon