Toowoomba real estate: Data reveals suburbs where mortgage repayments are cheaper than rent

Analysis of Toowoomba house prices has revealed the suburbs where it’s cheaper to buy a house than rent. Find out how much you could save:

A comparison of average monthly rent to monthly mortgage repayments has revealed it’s now cheaper in many suburbs across Toowoomba to buy rather than rent.

Analysis by Finder has found that based on repayments on a median priced home with an 80 per cent loan at median price, paying off a home loan is cheaper than paying the median monthly rent in all but a handful of suburbs across the Garden City.

The only suburbs where monthly rent is lower than monthly mortgage repayments for homes are Cranley, East Toowoomba, Middle Ridge, Mount Lofty, Newtown and Rangeville.

The data also found that with units, it would be cheaper to buy than rent right across Toowoomba.

CoreLogic research analyst Kaytlin Ezzy said historically renting had been the more affordable housing option.

“A few exceptions to this rule have been in tighter rental markets, typically across regional Australia, were low rental stock has allowed landlords to achieve a higher rental yield. This is the case for Toowoomba,” Ms Ezzy said.

“Despite recording stronger annual appreciation compared to rental growth across both property types, Toowoomba’s low rental stock and historically higher rental yields have seen monthly mortgage repayments fall below monthly rental cost under a 3.6 per cent mortgage rate scenario. As of April 2022, 18 of the 25 Toowoomba house suburbs and all of the 13-unit suburbs reported it was cheaper to buy than to rent.

“With current variable mortgage rates for owner occupiers averaging around 2.7 per cent, it is likely buying will continue to be the more affordable option in Toowoomba over the coming months.

“As interest rate rises move beyond the 3.6 per cent mortgage rate scenario, it’s possible renting could become the more affordable option.

“However, given Toowoomba’s low vacancy rate and its well below average advertised rental stock levels, Toowoomba’s rental market is likely to remain tight for some time yet.”

Ms Ezzy said with interest rates falling to record lows through the pandemic more suburbs around Australia became cheaper to rent than buy, however the trend could once again transition as rates rise.

Originally published as Toowoomba real estate: Data reveals suburbs where mortgage repayments are cheaper than rent