Should I Rent or Buy?

May 08, 2014
Tracey Heath

Rent or buy?


The wealth effects of owning stack up says Richmond home loan expert

Andrew Heath.


Australians love property – and with good reason. Owning your home offers

security, a sense of community and the wealth benefits of owning an

appreciating asset.


The trouble is, today’s rising property market is making it challenging for first

home buyers especially in Sydney - Australia’s most expensive city. The latest

figures from research group RP Data show the median house price in Sydney is

now a whopping $775,000.


Faced with price tags like that, it’s hardly surprising many would-be first home

buyers toss in the towel and opt to rent long term.


To be fair, renting can have its upsides. There’s the freedom to move frequently;

tenants face none of the costs of home maintenance; and it can be cheaper to

rent in some (though not all) areas than it is to pay off a home.


Renters can be left behind


But – and it’s a big but, home ownership is an outstanding form of forced

saving. A home loan obliges us to pay off a significant asset (our home), which

rises in value over time while the balance of our mortgage steadily declines.


Without the benefit of that forced saving, renters can easily be left behind when

it comes to personal wealth.


As evidence of this, a 2013 report by the Australian Bureau of Statistics[1]

found home owners without a mortgage have average personal worth of

$1,237,000. Home owners still paying off their home have net wealth averaging

$790,000. And at the far end of the scale, the average worth of renters is just



I reckon it’s a pretty compelling argument for home ownership.


Richmond home prices remain affordable


The thing is, here in the Hawkesbury, the goal of home ownership is far more

achievable than in many parts of Sydney. That’s because along with a vibrant

community and our wonderful semi-rural lifestyle, the Hawkesbury offers very

affordable home prices.


As a guide, property listing site says the median house price

in Richmond is $456,000. A short drive away in Windsor, the median house price is $475,000.



No wonder both Richmond and Windsor are described as ‘high demand’ areas.


Let’s make it happen


If you’re a first home buyer in Richmond or Windsor, it could be worth taking

advantage of today’s low interest rates to get a foothold in the property market

before property values rise further.


Saving for the traditional 20% deposit isn’t easy. But the team of home loan

experts at Mortgage Choice Richmond can explain a variety of strategies that

can get you off the rental treadmill and into your own home sooner even if you

don’t have substantial savings.


Discover what’s possible. Call your team of Richmond and Windsor home loan

experts today on 4578 9904 or 0411 550 600 at any time. Or send your email to


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See our video log for more information:

[1] ABS Cat 6554.0 - Household Wealth and Wealth Distribution, Australia, 2011–12, 21 August 2013. 

Posted in: Home loans

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