Is Renting Actually Cheaper Than Buying Right Now?

Perth renters are paying less each month than new homebuyers for the same properties, as the city's ongoing housing crunch continues to drive up both rent and mortgage costs — but tips the affordability balance toward tenants in most suburbs.

Why the Calculation Has Changed

Rising house prices, driven by ongoing demand from a rejuvenated mining sector and a growing population, have pushed Perth’s median home price past $680,000, according to latest figures from CoreLogic. Mortgage repayments on an average home now outpace weekly rent for comparable properties in many popular locations, just as the cost of money has climbed following last year’s rate hikes from the Reserve Bank of Australia. With supply on the ground at record lows — Perth's rental vacancy rate sat at just 0.8% last month — the old argument that buying 'saves money in the long run' is under more scrutiny than ever.

Comparing Rent vs Buy: Case Studies

Take Joondalup. On Lakeside Drive, a typical three-bedroom townhouse rents for around $670 per week, based on listings from Realmark and The Agency. At current interest rates, buying the same property with a 20% deposit and a 30-year principal-and-interest loan — at a 6.1% variable rate — means monthly repayments of roughly $3,300, or $762 a week. That’s a gap of nearly $100 per week in favour of renting. In Wanneroo, median weekly rents are up to $610, while mortgage repayments on a standard $600,000 home exceed $670 per week. REIWA data shows this pattern holds across most northern corridor growth suburbs, where tight supply has only partially offset skyrocketing sale prices.

Even closer to the CBD, tenants still find a cost edge. Apartments on Fitzgerald Street in North Perth list for $550-$620 a week, while buyers face monthly payments of $2,700 or more — exceeding $650 per week — for similar stock. Tight stock levels mean higher purchase prices and stiff competition at both home opens and rental inspections, as reported repeatedly by local agencies like Abel Property and First National Real Estate.

The Numbers Behind the Market

What’s behind the rent-vs-buy gap? While rents have spiked 18% citywide over the past 12 months (source: CoreLogic’s May 2026 rental index), median house prices have climbed even faster — up 21.5% in the same period. The interest rate environment hasn't helped would-be buyers: most ‘Big Four’ banks now charge over 6% on new owner-occupier variable loans. In practical terms, Housing Industry Association research out this week suggests a dual-income household on $120,000 would spend about 43% of income on mortgage repayments for an entry-level home in Balcatta — well above lending serviceability guidelines. In contrast, average rents still soak up around 34% of household income, according to Perth Renters Alliance.

With supply tight and Perth’s population swelling by more than 36,000 in the past year, housing pressure shows little sign of relief. Construction slowdowns and material shortages have kept new supply from catching up, despite well-promoted incentives from the WA Government’s Keystart low-deposit program and the City of Wanneroo’s new fast-tracking approvals initiative for infill units.

For most would-be buyers, the numbers are stark: unless a large deposit is available or there’s capacity to absorb higher repayments, renting still means lower out-of-pocket housing costs every month — even in a city with near-zero vacancy and rising rents.

While many continue to see property as a long-term wealth play, the immediate financial hurdle is acute. Local advisors at Momentum Wealth urge clients to factor in all ownership costs, including rising council rates and urgent maintenance, when weighing the switch from tenant to owner. Until Perth sees more homes entering the market, or interest rates soften, renters retain a slim cost advantage — and that dynamic is unlikely to shift before 2027, according to local projections.