Renting versus buying in Australia
Stamp duty is a state tax and the New South Wales transfer duty scale is used here, that being the largest state market. It is steeply progressive, running to 7%, and on a median dwelling around $850,000 the duty comes to roughly $33,000, several times the conveyancing, inspection and registration fees put together, and by a wide margin the largest cost of getting in.
Victoria, Queensland and the rest run their own scales, so check your state revenue office before treating the figure above as yours. Every state also runs first-home concessions, which can cut the duty sharply or remove it entirely below a threshold. None of them are modelled here, so a genuine first purchase is better than these figures.
Lenders mortgage insurance applies above 80% loan-to-value. Unlike Canada's CMHC premium it is priced by the insurer and the lender rather than set by law, and it rises steeply with the loan-to-value ratio, roughly 1% at 85%, 2% at 90% and 3.5% at 95% of the loan, capitalised into the mortgage. It is not included in this comparison; the mortgage calculator includes it.
Council rates are a flat annual charge set by each council, not a percentage of value, so they do not grow with the house here. Exit is cheap by international standards: agent commission of about 2% plus marketing, against the 5% or 6% American sellers have historically paid, a figure that became more negotiable after the 2024 NAR settlement.