C&G’s Guide to Buying Versus Renting

Once upon a time, the Great Australian Dream’s pinnacle was home ownership. We’d look to save for a home deposit, with renting broadly considered a short-term or temporary arrangement. My, how things have changed! Today, many people are preferring to rent a home – sometimes permanently. It’s no secret that rising house prices in blue chip areas of Melbourne are impacting upon affordability for many Victorians. This C&G blog unpacks the pros and cons of purchasing versus leasing long-term, so you can make an informed decision.

Pros of Leasing

Many who decide not to purchase their primary place of residence choose to redirect what would have been their home deposit savings elsewhere. Their reasons for not purchasing are various – some love travelling, study, or choose to invest their funds in beginning a business. Investment for the future remains important, with long-term tenants electing to purchase shares or ‘rentvest’ (choosing to lease where they live and buy real estate elsewhere).

As we urbanise, our collective attitude towards leasing has changed. Tenants intend on leasing for longer and want the freedom to make their house a home. In response to this change in expectations, a number of reforms to the Residential Tenancies Act are being instituted - which will make the leasing experience easier for everyone. Pet ownership is likely to be easier for tenants, and reasonable flexibility around interior decoration is expected.

Cons of Leasing

The most important consideration for long term tenant is investing for their future. You’ll one day pay a mortgage off in entirety, whereas leasing does not result in the security of ownership. Rental cost can potentially increase, impacting upon a tenant’s budget. If your goal is to purchase a home at some point in the future, leasing may be a roadblock to significant deposit savings.

Pros of Buying

Buying a home makes it permanently your own. Many people want the security of permanence, and the freedom to renovate and update to their heart’s content. Owning a house can also align with family-orientated goals, and with it the peace of mind that you won’t need to relocate should a landlord choose to end your lease. As this article from the Sydney Morning Herald eloquently describes, paying a mortgage on your home builds financial discipline. With each payment you’re investing in your own financial plan.

Cons of Buying

A home purchase is the largest investment most people will make in their lifetime. Home ownership is not the easiest road to take, what with interest payments and maintenance. It is also possible to fall behind in mortgage repayments if you don’t have an emergency savings plan, should life throw something unexpected in your way.

As you can see, choosing to invest in real estate or to lease long term is a complex decision. Feeling confused about the best way forward for you? Chisholm & Gamon have worked with tenants, landlords and homeowners for many years, and have accumulated a wealth of knowledge regarding each lifestyle. Don’t hesitate to contact us with any queries!


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90 Ormond Road,
Elwood Vic 3184
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Black Rock Vic 3193
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Port Melbourne Vic 3207
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