Renters in Auckland $12,500 p.a better off than homeowners

Renters in Auckland $12,500 p.a better off than homeowners

It is cheaper to rent a house than buy a house across New Zealand, but the disparity is most pronounced in Auckland according to Trade Me Property’s comparison of asking rents and asking prices in October.

Head of Trade Me Property Nigel Jeffries said the latest Rental Index figures showed that paying off an 80 per cent interest-only mortgage* rather than the median weekly rent could see you paying up to $2,000 a year more outside Auckland, and significantly more in our largest city.

“In Auckland you could be stumping up more than $12,000 per annum on your mortgage, so if you’re making a cold-hearted decision based purely on mathematics it is food for thought. Of course, there’s so much more to weigh up in reality, such as interest rate changes, potential capital gains and all the other personal circumstances and psychological aspects involved in any property purchase.”

He said there was strong interest from Auckland buyers looking to invest elsewhere in the country, with some making the decision to rent in the Super City, but purchase a home in another region to rent out. Interest from Aucklanders has been particularly strong in the Bay of Plenty.

Potential Wellington home owners can expect to pay about 8 per cent more than renters, while in Christchurch the gap is just 1 per cent. In 2014, the data showed that Christchurch was an exception in that paying the interest on a mortgage was cheaper than renting. Mr Jeffries attributed that to the “tight supply” around the number of rental properties last year.

Full Report:Trade Me Property Report 19th November

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