New modelling revealed the suburbs where the cost of renting is expected to outstrip the cost of mortgage repayments in the shortest time. Picture: Supplied
There are five Hobart suburbs where the family budget will soon be better off buying a house than renting.
In the Eastern Shore suburb Risdon Vale, this could happen by the end of the year.
Austins Ferry, Bridgewater, and New Norfolk are set to reach this point next year, while Glenorchy will cross the line in January 2028.
New PropTrack modelling shows over 30 Hobart suburbs where renting is expected to outstrip the cost of monthly mortgage repayments in typical houses, shrinking the monthly payment gap for people.
While Battery Point and Sandy Bay were among the areas where it would take longer for rents to close the gap, Geilston Bay was the longest at 35 years (420 months).
This was twice as long as it would take in Battery Point (17.3 years or 208 months).
In Sandy Bay, renting is expected to be cheaper for 14 years (169 months).
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No.9 Athena Dr, Risdon Vale can be leased for $560 per week with Harcourts Kingborough. Picture: realestate.com.au
No.16 Magnolia Rd, Risdon Vale was sold by Petrusma Property for $600,001, per realestate.com.au
In greater Hobart, at today’s average lender’s rate of 5.75 per cent, the typical rent is $2383 while a mortgage is $3221 per month.
This $838 gap is forecast to close in mid-2031.
If interest rates rise to 6.1 per cent, Hobart’s typical mortgage would rise to $3345 and rent to $2383, with the modelling showing rents would not catch up to loan payments until early 2032.
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Outside the capital, there are five suburbs where rents are forecast to be greater than mortgage repayments within two years — and another area where it has already happened.
On the West Coast, Queenstown’s typical rent is $1300 per month, while loan repayments are $980, per PropTrack’s figures.
Ravenswood, Mowbray and Smithton rents are forecast to reach loan payments in about one year’s time, while Georgetown and Invermay will be closer to two years.
What’s the best option?
Real Estate Institute of Tasmania president Russell Yaxley said homeownership is a goal for many renters but not for everyone.
“Renting may provide flexibility for work, to travel and fit their lifestyle now and into the future,” he said.
“The rental market plays an important role in giving people a choice, flexibility and time to make the best decision for them.”
Mr Yaxley said affordability is one of the key drivers for buyers.
“People generally have a budget for their situation and this shapes the type of property and where they search,” he said.
“Renting can open up different suburbs and different home types, which might be a priority for them over purchasing a home.”
Real Estate Institute of Tasmania president Russell Yaxley.
PropTrack economist Anne Flaherty said the relationship between rents and property values tends to look different in cheaper markets than in the most expensive areas.
“In more affordable areas, the rent relative to the value of the property is typically higher,” she said.
“That means the gap between mortgage costs and rental income can close more quickly.”
Realestate.com.au economist Anne Flaherty.
Ray White economist Nerida Conisbee said affordability was at its weakest level in years, with deposits taking longer to build and mortgage serviceability stretching household budgets.
“For many buyers, the deposit is the biggest roadblock. Rents are rising and saving is getting tougher,” Ms Conisbee said.
She said demand had shifted toward entry-level stock and the unit market, as buyers traded space for a foothold.
“Government schemes can shave years off the deposit hurdle — they don’t make homes cheap, but they change how people get in.”
PropTrack’s data assumed a suburb’s median purchase price, with a 20 per cent deposit on a 30-year principal and interest loan. Rents compounded using a 10-year average.
Additional reporting Viva Hyde, David Bonaddio
| Time taken for monthly rents to exceed monthly mortgage repayments | ||||||||||
| Suburb | Median sale price | Monthly repayments | Monthly rent | Crossover month | ||||||
| Risdon Vale | $482,500 | $2,252.59 | $2,145.00 | 31/12/2026 | ||||||
| Austins Ferry | $670,000 | $3,127.95 | $2,903.33 | 31/01/2027 | ||||||
| Bridgewater | $470,000 | $2,194.23 | $2,036.67 | 31/05/2027 | ||||||
| New Norfolk | $490,000 | $2,287.61 | $2,123.33 | 31/05/2027 | ||||||
| Glenorchy | $600,000 | $2,801.15 | $2,470.00 | 31/01/2028 | ||||||
| Claremont | $580,000 | $2,707.78 | $2,383.33 | 30/04/2028 | ||||||
| Midway Point | $653,000 | $3,048.58 | $2,600.00 | 30/09/2028 | ||||||
| Mornington | $630,000 | $2,941.21 | $2,470.00 | 30/11/2028 | ||||||
| Lutana | $633,500 | $2,957.55 | $2,600.00 | 31/01/2029 | ||||||
| Rokeby | $650,000 | $3,034.58 | $2,383.33 | 28/02/2029 | ||||||
| Moonah | $650,000 | $3,034.58 | $2,513.33 | 31/03/2029 | ||||||
| Berriedale | $650,000 | $3,034.58 | $2,513.33 | 31/07/2029 | ||||||
| Primrose Sands | $507,500 | $2,369.31 | $1,971.67 | 31/08/2029 | ||||||
| Kingston | $749,000 | $3,496.77 | $2,730.00 | 31/07/2030 | ||||||
| Sorell | $720,000 | $3,361.38 | $2,643.33 | 30/09/2030 | ||||||
| Chigwell | $550,000 | $2,567.72 | $2,296.67 | 30/09/2030 | ||||||
| Old Beach | $720,000 | $3,361.38 | $2,708.33 | 31/03/2031 | ||||||
| Lenah Valley | $800,000 | $3,734.87 | $2,816.67 | 31/03/2031 | ||||||
| West Moonah | $676,500 | $3,158.30 | $2,383.33 | 31/05/2031 | ||||||
| Rosetta | $650,000 | $3,034.58 | $2,600.00 | 31/05/2031 | ||||||
| Lindisfarne | $781,500 | $3,648.50 | $2,600.00 | 30/04/2032 | ||||||
| Howrah | $807,500 | $3,769.88 | $2,730.00 | 31/05/2032 | ||||||
| Dodges Ferry | $742,000 | $3,464.09 | $2,166.67 | 31/03/2033 | ||||||
| New Town | $883,000 | $4,122.36 | $2,816.67 | 31/10/2033 | ||||||
| North Hobart | $880,000 | $4,108.35 | $2,764.67 | 31/01/2034 | ||||||
| Bellerive | $885,500 | $4,134.03 | $2,730.00 | 30/11/2034 | ||||||
| South Hobart | $847,500 | $3,956.62 | $2,578.33 | 30/04/2036 | ||||||
| West Hobart | $937,500 | $4,376.80 | $2,816.67 | 31/07/2036 | ||||||
| Blackmans Bay | $877,500 | $4,096.68 | $2,600.00 | 31/08/2036 | ||||||
| Sandy Bay | $1,350,000 | $6,302.59 | $3,250.00 | 29/02/2040 | ||||||
| Battery Point | $1,635,000 | $7,633.13 | $3,358.33 | 31/05/2043 | ||||||
| Geilston Bay | $770,000 | $3,594.81 | $2,686.67 | 31/01/2061 | ||||||
| Source: PropTrack Assuming 80% loan-to-value on a 30-year loan at an interest rate of 5.75% (current RBA lenders rate plus recent rate rise). | ||||||||||
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