The Burrow
Jul 13, 2026
The home loans comparison experts at Compare the Market have analysed global and Australian data to find out which countries and Australian cities have the biggest price gaps between buying a property and renting, including further insight into Australia’s property market for houses and units.
When examining the global price-to-rent ratio, we divided each country’s house price index by their rent price index. Using this data, we set out to find where in the world it’s cheaper to buy than rent.
Finland is the only country where it’s cheaper to buy than rent. It reported a negative house price-to-rent ratio, with only a 3.5% price-to-rent difference. This suggests that renting is cheaper in the majority of the places analysed in this study.
Türkiye had the most significant house price-to-rent ratio, at 100.63%, making it the most expensive country to buy rather than rent. Portugal saw the second-highest price gap between home ownership and renting, with home ownership costing 73.25% more than renting. Hungary had the third-highest house price-to-rent ratio, with house prices 65.60% higher than rent.
Although Australia did not rank among the world’s most expensive countries for home ownership relative to renting, the data suggests many Australians still face a considerable affordability gap when entering the property market. With house prices estimated to be 30.41% higher than renting nationally. However, the picture varies significantly across Australia’s capital cities, read on to see the price difference across Australia.
| Rank | Country | House price to rent ratio | Difference between house price and rent |
| 1 | Türkiye | 200.63 | 100.63% |
| 2 | Portugal | 173.25 | 73.25% |
| 3 | Hungary | 165.60 | 65.60% |
| 4 | Latvia | 164.55 | 64.55% |
| 5 | Mexico | 161.22 | 61.22% |
| 6 | Netherlands | 161.19 | 61.19% |
| 7 | Greece | 160.33 | 60.33% |
| 8 | Bulgaria | 160.01 | 60.01% |
| 9 | Croatia | 159.28 | 59.28% |
| 10 | Czechia | 158.90 | 58.90% |
| 11 | Iceland | 156.60 | 56.60% |
| 12 | Slovak Republic | 149.69 | 49.69% |
| 13 | Spain | 144.44 | 44.44% |
| 14 | Luxembourg | 144.07 | 44.07% |
| 15 | Canada | 135.81 | 35.81% |
| 16 | Lithuania | 134.83 | 34.83% |
| 17 | United States | 133.31 | 33.31% |
| 18 | Estonia | 133.13 | 33.13% |
| 19 | Japan | 132.59 | 32.59% |
| 20 | Australia | 130.41 | 30.41% |
OCED data on price to rent ratio reported in 2024
For many Australians, home ownership is a key milestone on the path to financial security and long-term stability. However, ongoing cost-of-living pressures and rising property prices continue to make entering the housing market challenging for many Australians.
To compare the affordability of buying versus renting across Australia, we analysed median house and unit values alongside median rental prices in each capital city. To provide a like-for-like comparison, we assumed buyers had a 20% deposit and calculated monthly mortgage repayments using a 6% interest rate on the remaining loan amount. We then compared these repayments against median monthly rental costs and calculated price-to-rent ratios to assess the relative affordability of home ownership and renting in each market.
This analysis is intended as a guide only and does not account for additional ownership costs such as stamp duty, council rates, insurance, maintenance, body corporate fees, or changes in interest rates and property values over time.
| Rank | City | Median house price | Deposit needed (20%) | Loan needed (value – deposit) | Monthly repayments (6% interest rate) | Monthly rent | Rent vs Buy | Rent vs mortgage % |
|---|---|---|---|---|---|---|---|---|
| 1 | Sydney | $1,607,046 | $321,409.20 | $1,285,636.80 | $7,708.04 | $3,735.33 | Rent | 106% |
| 2 | Brisbane | $1,175,981 | $235,196.20 | $940,784.80 | $5,640.48 | $3,228.33 | Rent | 75% |
| 3 | Melbourne | $977,579 | $195,515.80 | $782,063.20 | $4,688.86 | $2,829.67 | Rent | 66% |
| 4 | Adelaide | $980,815 | $196,163.00 | $784,652.00 | $4,704.39 | $2,890.33 | Rent | 63% |
| 5 | Canberra | $1,051,977 | $210,395.40 | $841,581.60 | $5,045.71 | $3,245.67 | Rent | 55% |
| 6 | Perth | $1,032,032 | $206,406.40 | $825,625.60 | $4,950.04 | $3,354.00 | Rent | 48% |
| 7 | Hobart | $779,059 | $155,811.80 | $623,247.20 | $3,736.68 | $2,725.67 | Rent | 37% |
| 8 | Darwin | $709,975 | $141,995.00 | $567,980.00 | $3,405.33 | $3,258.67 | Buy | 5% |
Median house price data: Cotality monthly Home Value Index, Q1 Feb 2026
Sydney is the most expensive city in Australia to buy a home, which may be unsurprising given its iconic beaches, lifestyle appeal, and status as one of the most sought-after places to live. The city recorded the highest median house price at just over $1.6 million, placing home ownership well out of reach for many Australians. Assuming the mortgages repayments have a 20% deposit and factoring in monthly repayments at a 6% interest rate, Sydney homeowners are paying around 106% more per month than renters. The average mortgage repayment sits at over $7,700 per month, compared to roughly $3,735 for renters. While property ownership remains a strong long-term investment, these figures highlight a significant short-term affordability gap. For those not planning to stay in Sydney long-term, renting may be the more financially viable option.
Brisbane is the second most expensive city in Australia to buy a home, with the median house price sitting at around $1.17 million in the Sunshine State’s capital. Renting remains significantly more affordable in the short term, with rent reported to be 75% cheaper than buying in Brisbane. The average monthly rent is approximately $3,228, compared with mortgage repayments of roughly $5,640 per month at a 6% interest rate. These figures highlight the growing affordability gap facing would-be homeowners, particularly in fast-growing markets like Brisbane, which could see a knock-on effect of demand and low ongoing supply pushing property prices higher.
Melbourne house prices aren’t as high as Sydney or Brisbane, but it reported the third-highest house price-to-rent ratio, with Victoria’s capital city being 66% cheaper to rent than buy. The median house price is roughly $978k, with mortgage repayments averaging $4,688, compared with the average monthly rent of $2,829.
Adelaide was ranked fourth in the house price-to-rent ratio, where renting is 63% cheaper than buying. The median house price is sitting just above Melbourne at $980k, while mortgage repayments are $4,704, compared with monthly rent at $2,890.
Canberra is the third-most expensive capital city in Australia to buy a home, with a median house price of approximately $1.05 million, making monthly mortgage repayments around $5,045. By comparison, the median monthly rent is $3,246, making rent approximately 55% cheaper than buying. While Canberra’s property prices remain high, the city’s rental market is also relatively expensive. As a smaller capital city, Canberra has a more limited housing supply than larger markets such as Melbourne, which may contribute to higher rental costs.
Perth is the fourth-most expensive capital city in Australia to buy a home, with a median house price of just over $1.03 million. While Perth’s rental market remains one of the more expensive in the country, renting is still considerably more affordable than buying on a month-to-month basis. Monthly mortgage repayments would be $4,950, compared to a median monthly rent of $3,354, making it 48% cheaper than buying, highlighting the financial challenge facing prospective homeowners despite Perth offering a more affordable entry point than Sydney, Brisbane and Canberra.
Hobart ranked seventh in the house price-to-rent ratio, with renting reported to be 37% cheaper than buying a house. The Tasmanian capital recorded a median house price of $779k, resulting in estimated monthly mortgage repayments of approximately $3,736. By comparison, the median monthly rent sits at around $2,726. While Hobart remains one of the more affordable capital cities for home buyers compared to larger markets such as Sydney, Brisbane and Melbourne, renting still offers a noticeable short-term cost advantage. The relatively narrow gap between rental costs and mortgage repayments may appeal to prospective buyers looking to enter the property market in a capital city where property values remain lower than many mainland counterparts.
Darwin is the only capital city in Australia where buying a house is was only 5% more than renting. With a median house price of $709k, Darwin’s property market is considerably more affordable than most other capital cities. However, it is also Australia’s least-populated capital city, which may influence both property values and housing demand. Monthly mortgage repayments would be roughly $3,405, compared to a median monthly rent of $3,259.
| Rank | City | Median unit price | Deposit needed (20%) | Loan needed (value – deposit) | Monthly repayments (6% interest rate) | Monthly rent | Rent vs Buy | Rent vs mortgage % |
|---|---|---|---|---|---|---|---|---|
| 1 | Brisbane | $844,844 | $168,968.80 | $675,875.20 | $4,052.21.00 | $2,842.67 | Rent | 43% |
| 2 | Adelaide | $675,818 | $135,163.60 | $540,654.40 | $2,413.67 | $2,413.67 | Rent | 34% |
| 3 | Sydney | $903,080 | $180,616.00 | $722,464.00 | $4,331.54 | $3,328.00 | Rent | 30% |
| 4 | Hobart | $574,204 | $114,840.80 | $459,363.20 | $2,754.11 | $2,240.33 | Rent | 23% |
| 5 | Melbourne | $642,431 | $128,486.20 | $513,944.80 | $3,081.36 | $2,643.33 | Rent | 17% |
| 6 | Perth | $725,951 | $145,190.20 | $580,760.80 | $3,481.95 | $3,016.00 | Rent | 15% |
| 7 | Canberra | $598,440 | $119,688.00 | $478,752.00 | $2,870.36 | $2,617.33 | Rent | 10% |
| 8 | Darwin | $442,985 | $88,597.00 | $354,388.00 | $2,124.74 | $2,647.67 | Buy | -20% |
Median unit price data: Cotality quarterly rental review, April 2025
Australia’s unit market presents a very different affordability picture to the housing market, with the gap between renting and buying considerably narrower in most capital cities.
Brisbane ranks as the least affordable city for unit buyers, with mortgage repayments sitting around 43% higher than rent. Based on a median unit price of $844,844, buyers would face monthly repayments of approximately $4,052.21, compared to an average unit rent of $2,843 per month.
Adelaide and Sydney also favour renters, with mortgage repayments around 34% and 30% higher than rental costs, respectively. While units offer a more affordable entry point than houses, renters in these cities still enjoy a noticeable monthly cost advantage.
Units in Melbourne and Perth mortgage repayments were 17% and 15% higher than rent. Monthly mortgage repayments average roughly $400 more than rent.
Meanwhile, Canberra was closer to closing the gap with monthly mortgage repayments on a unit was 10% more than renting, with monthly mortgage repayments averaging at $2,870 and monthly rent at $2,617.
Again, Darwin stands out as the clear winner for prospective buyers, with mortgage repayments roughly 20% higher than rental costs. The average monthly mortgage repayment is $2,124, compared to rent of $2,648, making it the most affordable capital city for unit ownership.
Chris Ford at Compare the Market, comments:
“While renting is currently the cheaper option in most Australian capital cities when comparing monthly costs alone, the decision isn’t always straightforward. Buying a home allows Australians to build equity over time, while renters may benefit from greater flexibility and lower upfront costs. Ultimately, the right choice will depend on an individual’s financial position, lifestyle goals and how long they plan to stay in a particular location.
“Comparing home loans can help Australians find a mortgage that suits their needs and potentially save money in the process. By comparing different products, borrowers can assess interest rates, fees, loan features and repayment flexibility to find an option that aligns with financial circumstances and can support reducing borrowing costs to make home ownership more manageable, particularly in a market where every dollar counts.”
Global housing costs: The house price-to-rent ratio for each country was sourced from the OECD, 2024. It is calculated by dividing the nominal house price index by the housing rent price index from the same source. For example, a ratio of 151.1 means that house prices are 51.1% higher than renting.
Source:
Housing prices – OECD
Australian housing costs: The median house and unit price in each city was then calculated using a 20% deposit and a 6% interest rate to determine the monthly mortgage repayments.
Sources:
Median dwelling, house and unit values: Cotality monthly Home Value Index, Q1 Feb 2026
Key rental statistics: Cotality quarterly rental review, April 2025
See Renting vs Buying costs from 2021: www.comparethemarket.com.au/home-contents-insurance/features/renting-vs-buying-2021/