Renting vs. Owning in Australia
Finder's research examines whether renting or paying off a mortgage is more affordable in the current housing market.
Key takeaways
- Monthly mortgage repayments often exceed rent in major cities. Sydney's average mortgage is $7,275 versus $3,211 rent.
- Financial strain is widespread, with 44% of renters and 35% of mortgage holders struggling to afford payments.
- Renting provides flexibility and lower upfront costs. Owning builds equity but involves higher initial and ongoing expenses.
The debate over whether it is cheaper to rent or buy a property has never been more relevant, particularly for low-income earners navigating Australia’s challenging housing market. Finder’s latest research sheds light on the cost-effectiveness of homeownership compared to renting.
Key Statistics
- As of January 2026, Sydney has the largest gap between mortgage repayments and rent, with average monthly mortgage payments at $6,866, compared to $3,236 for rent.
- 44% of Australian renters are struggling to afford their rent.
- The highest levels of rental stress are in the South Australia (76%), followed by Queensland (62%).
- 35% of mortgage holders are facing financial strain, with the most significant challenges in New South Wales (59%) and Victoria (58%).
Comparing Monthly Costs: Renting vs. Owning
Across major Australian cities, mortgage repayments generally exceed rental costs, making renting the more affordable option. Sydney has the largest gap, with average monthly mortgage repayments at $6,866, compared to $3,236 for rent.
This trend is also evident in Melbourne, Brisbane, Adelaide, Perth, Hobart and Canberra, where mortgage costs surpass rent by several hundred dollars.
Monthly Amortization vs Rent
Pros and Cons of Owning
| Pros of Owning | Cons of Owning |
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Pros and Cons of Renting
| Pros of Renting | Cons of Renting |
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Can a minimum wage earner afford a mortgage?
Affordability remains a major issue for many Australians, particularly those on lower incomes. Latest figures from the Australian Bureau of Statistics show the average weekly earnings for full-time adults are $2,051. While homeownership remains largely out of reach for minimum-wage earners, renting is generally a more realistic option for low-income households.
With property prices, interest rates and the cost of living continuing to rise, buying a home has become increasingly out of reach without financial support or a dual income. The higher cost of mortgage repayments compared to rent reinforces the notion that renting is the more practical choice for those earning lower wages.
Australia's Housing Struggles in 2025
Finder’s January 2026 survey shows 44% of Australians are struggling to keep up with rent, underscoring persistent pressure on housing affordability.
Rental stress varies across states. South Australia records the highest share at 76%, followed by Queensland at 62%, while Tasmania is lower at 44%.
Mortgage holders are also feeling the pinch, with 35% reporting difficulty meeting their home loan repayments.
This strain is unevenly distributed. New South Wales has the highest level of mortgage stress at 59%, closely followed by Victoria at 58%, while Queensland reports the lowest share at 41%.
Final Thoughts
The decision between renting and buying depends on individual circumstances. Renting offers greater flexibility and lower upfront costs, while homeownership provides long-term financial benefits through equity building.
However, in the current market, homeownership remains out of reach for many Australians, particularly those on lower incomes. With housing affordability an ongoing national concern, it is crucial for individuals to carefully assess their financial situation, lifestyle needs and long-term goals before making a decision.
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