Rent vs Buy Calculator — Australia (2026)
Should you buy a home in Sydney, Melbourne or Brisbane — or rent the same place and invest every spare dollar in ASX ETFs? This free calculator answers it with real tax law and honest uncertainty: exact stamp duty brackets per state, LMI, land tax, negative gearing, fast-rising insurance, and 400 simulated futures instead of one optimistic line.
Open the interactive calculator →
What it models that most calculators skip
- Apples-to-apples cash flow — both people spend identical totals; the renter invests the difference (deposit and stamp duty included) into a basket of up to three ASX ETFs.
- Real state rules — NSW, VIC and QLD stamp duty computed from current brackets (including Victoria's flat-5.5% band and Queensland's home concession) and each state's land tax for investors.
- Investment-property mode — rent it out instead: rental income after vacancy and management fees, Division 43 depreciation, negative-gearing refunds, investor CGT.
- Honest uncertainty — a seeded Monte Carlo drifts house prices, ETF returns and even your variable mortgage rate (repayments reprice yearly, as real loans do), then shows the full distribution of outcomes and a win probability.
- Insurance reality — Australian home premiums rose ~7.2%/yr over 2010-25 and 14-18% in 2025 alone (APRA data); the model escalates them separately from CPI.
The RBA's break-even rule
The Reserve Bank's research paper Is Housing Overvalued? (Fox & Tulip, RDP 2014-06) frames the decision as a user-cost comparison: owning beats renting only when expected house-price growth exceeds mortgage rate + running costs − rental yield. The calculator computes this break-even live against your own growth assumption — it is the single most useful sentence in the whole debate.
Stamp duty by state (2025-26)
Computed from the current schedules — QLD shows home-concession / investor rates.
| Purchase price | NSW | VIC | QLD (home / investor) |
|---|---|---|---|
| A$800,000 | A$30,529 | A$43,070 | A$21,850 / A$29,025 |
| A$1,000,000 | A$39,529 | A$55,000 | A$30,850 / A$38,025 |
| A$1,500,000 | A$64,909 | A$82,500 | A$59,600 / A$66,775 |
| A$2,000,000 | A$92,409 | A$110,000 | A$88,350 / A$95,525 |
Current market snapshot
Refreshed monthly from AI-assisted research, cross-checked against CoreLogic/ABS-grade sources.
| City | Median house | Median unit | House yield |
|---|---|---|---|
| Sydney | A$1,791,643 | A$848,227 | 2.9% |
| Melbourne | A$1,085,000 | A$626,869 | 3.4% |
| Brisbane | A$789,764 | A$580,000 | 4.1% |
Frequently asked questions
Is it cheaper to rent or buy in Australia in 2026?
It depends on the numbers, not the slogan. The RBA's user-cost framework says owning beats renting only when house prices grow faster than: mortgage rate + running costs − rental yield. At a ~6.4% variable rate and Sydney's ~3% gross yield, that break-even is roughly 4-4.5%/yr price growth. Our calculator computes it live for your exact inputs and runs 400 simulated futures rather than one guess.
What does "rent and invest the difference" actually mean?
Both people spend the same total cash. The buyer pays a deposit, stamp duty, mortgage, council rates, insurance and maintenance. The renter pays rent — and invests every leftover dollar (including the deposit and stamp duty they didn't spend) into ASX ETFs like VAS, VGS or IVV. If renting ever costs more than owning, the difference is withdrawn from the portfolio. No free money on either side.
How much is stamp duty on a $1.5 million house?
In NSW it is A$64,909; in Victoria A$82,500; in Queensland A$59,600 with the home concession (A$66,775 for investors). The calculator computes duty from each state's current brackets automatically.
Does the calculator handle investment properties and negative gearing?
Yes — a dedicated investment mode models rental income (net of vacancy weeks and property-management fees), land tax at your state's investor rates, Division 43 building depreciation, negative-gearing tax refunds at your marginal rate, and CGT on sale with the 50% discount but no main-residence exemption.
Is my own home exempt from land tax and capital gains tax?
Generally yes: your principal place of residence is exempt from land tax in NSW, VIC and QLD, and from CGT federally. Investment properties get neither exemption — land tax starts at just $50,000 of land value in Victoria, $600,000 in Queensland and $1,075,000 in NSW.
Are the results financial advice?
No. This is an educational model with every assumption editable and sourced. It ignores franking credits and your personal circumstances. Speak to a licensed adviser before acting on it.
Sources
- RBA RDP 2014-06 — Is Housing Overvalued? (Fox & Tulip)
- Revenue NSW — transfer duty & land tax
- State Revenue Office Victoria — land transfer duty & land tax
- Queensland Revenue Office — transfer duty & land tax
- Actuaries Institute — home insurance affordability (APRA data)
- Market Index — ASX accumulation index history