Question 1

Is it better to rent and invest or buy a house in Australia?

Accepted Answer

It depends on your specific numbers. In high-price cities like Sydney and Melbourne, renting and investing the deposit often produces more wealth over 20-30 years when share returns exceed property growth. In lower-price markets, buying can win. Use the calculator above to model your exact scenario.

Question 2

What is the cashflow-neutral methodology?

Accepted Answer

Cashflow neutrality means both scenarios — buying and renting — have the same total monthly outgoing. The renter invests the difference between their rent and what the mortgage would have cost. This ensures a fair apples-to-apples comparison of wealth outcomes.

Question 3

Does this calculator include stamp duty and maintenance costs?

Accepted Answer

This simplified tool does not include stamp duty, maintenance, rental income, or franking credits. For a complete analysis with all Australian tax considerations including FIFO CGT, land tax, Division 40/43 depreciation, and Monte Carlo risk modelling, use the full Tepuy Property vs Shares Calculator.

Question 4

What share return should I use for Australia?

Accepted Answer

The ASX 200 has historically returned around 9-10% per year including dividends over long periods. A conservative assumption of 7-8% is commonly used for planning purposes. The S&P 500 has averaged approximately 10% annually in USD terms over the long run.

Question 5

How accurate is this calculator?

Accepted Answer

This tool provides a simplified directional estimate. It applies marginal income tax to investment returns and a simplified CGT discount on gains at sale. It does not model negative gearing, rental income, offset accounts, or year-by-year tax events. For full accuracy use the Tepuy Property vs Shares Calculator.

Question 6

Should I buy or rent in Sydney in 2026?

Accepted Answer

In Sydney, the median house price is around $1.4M (2026). With a 20% deposit of $280,000 invested in the ASX at 8.5% instead, you'd accumulate roughly $930,000 after 20 years — while also paying rent. The property would need to grow at approximately 7–8% annually to match that outcome, accounting for mortgage interest. Sydney has historically hit that threshold, but with significant variability by suburb. Use this calculator with your specific numbers to see which path builds more wealth in your situation.

Question 7

Should I buy or rent in Melbourne in 2026?

Accepted Answer

Melbourne median house prices are around $940,000 in 2026, with growth slowing compared to the post-COVID surge. With a 20% deposit of $188,000 invested at 8.5%, you'd accumulate approximately $620,000 after 20 years. Melbourne property has averaged around 5–6% growth over the past decade, which sits below the breakeven rate needed to beat shares — making the buy decision less clear-cut than in Brisbane or Perth. Model your specific suburb in this calculator.

Question 8

Is renting really throwing money away?

Accepted Answer

No — this is one of the most persistent myths in Australian property. When you rent, you pay for housing. When you buy, you also pay — in mortgage interest, rates, insurance, maintenance, and stamp duty. The question is not rent vs zero; it's rent + invest the deposit vs buy. In many Australian cities, investing the deposit in a diversified share portfolio while renting produces equal or greater wealth over 20–30 years. This calculator shows you the honest comparison for your numbers.

Question 9

How much deposit do I need to buy vs rent comparison to make sense?

Accepted Answer

The standard minimum deposit for a mortgage without LMI is 20%. Below 20%, you'll pay Lenders Mortgage Insurance (LMI), which can add $10,000–$30,000 to your costs and makes buying even harder to justify financially. This calculator uses a 20% deposit by default. You can adjust it — but bear in mind smaller deposits also mean higher LVR and more interest paid over the life of the loan.

Question 10

What if I rent and don't invest the difference?

Accepted Answer

Then renting almost certainly loses. The entire financial case for renting over buying depends on actually investing the deposit and the monthly cashflow difference in a diversified portfolio. If you rent and spend the difference, you accumulate no wealth and build no equity. The discipline to invest the deposit and maintain contributions is what makes renting competitive with buying — not rent itself.

Question 11

Does this account for rent increasing over time?

Accepted Answer

This simplified calculator uses a constant rent input. In practice, rent increases over time with inflation and local market conditions — which makes the renter's cashflow position gradually worse relative to a fixed-rate mortgage. The full Tepuy Property vs Shares Calculator models rent inflation alongside property growth, rental income, and year-by-year cashflows for a more complete picture.

Are you making a
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Your scenario

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How the maths works

Two parallel futures

Cashflow neutrality

Wealth after N years

Are you making amillion-dollar housing mistake?