Is it better to buy a house or invest in Australia?

It depends on your time horizon, location, and investment strategy. Over 20+ years in a growing suburb, property often wins due to leverage (you borrow 80% of the value) and the CGT exemption on your primary residence. Over shorter periods or in flat markets, a diversified portfolio of ETFs and shares can outperform because there are no stamp duty or maintenance costs. The key is comparing like-for-like: if you rent instead of buying, you should invest the difference between your rent and what a mortgage would cost.

How much does stamp duty cost when buying a house in Australia?

Stamp duty varies by state and property value. In NSW, stamp duty on a $750,000 property is approximately $28,000 for an existing buyer, but first home buyers pay $0 (full exemption up to $800,000). In VIC, the same property attracts around $40,000 in duty. First home buyer concessions differ by state. Stamp duty is a significant upfront cost that the 'rent and invest' alternative avoids entirely.

What returns can I expect from Australian shares vs property?

Over the long run, Australian shares (ASX200) have returned approximately 7-8% per annum including dividends, while capital city property has grown around 5-6% per annum in blue-chip suburbs and 3-4% in regional areas (CoreLogic data). However, property returns are amplified by leverage — if you put down 20% and the property grows 5%, your equity return on cash invested is much higher. Shares are more liquid and have lower transaction costs but don't benefit from the same leverage or CGT exemption that a primary residence offers.

Buy a House or Invest?

Should you buy property or rent and invest the difference in shares, ETFs, gold, or crypto? Enter your numbers — every assumption is editable so you own the result, not us.

Last verified: 5 May 2026

Should I buy a house or invest instead?

Long-run returns: Australian shares (ASX200) ~7-8% p.a. including dividends; capital-city property ~5-6% p.a. in blue-chip suburbs, 3-4% regional (CoreLogic). Property wins on leverage — a 20% deposit means a 5% price-rise delivers 25% equity return — and on the CGT exemption for your main residence. Shares win on liquidity, lower transaction costs, and no stamp duty. The honest comparison is "buy vs rent and invest the difference" on the same monthly cashflow. Source: CoreLogic Home Value Index; ASX Long-term Investing Report.

Worked example. $750,000 property in NSW, $150k deposit, 6% loan, 5% growth, 30 years. Stamp duty ~$28,000 (nil for first home buyers under $800k in NSW). Vs renting at $600/wk and investing $150k + the mortgage-to-rent gap at 7% in a balanced ETF portfolio: over 30 years property often comes out ~10-25% ahead if the suburb grows at 5%+ (thanks to leverage and CGT exemption). In flat or regional markets (3% growth), shares usually win. Short horizons (under 7 years) → shares win due to stamp duty + selling costs.

Time horizon*

years

How many years to compare.

Annual income*

For calculating CGT at your marginal rate.

State*

Determines stamp duty.

Property

Property price*

Deposit*

Loan interest rate*

Variable or fixed rate.

Loan term*

years

First home buyer?

Yes

Will you live in it?

Yes (PPR)

No CGT when you sell

No (investment)

CGT applies at sale

Suburb growth type

Default growth: 5% p.a.

Rates + insurance

% p.a.

Of property value.

Maintenance

% p.a.

Of property value.

Selling costs

Agent + marketing.

Rent (if you don't buy)

Weekly rent*

Rent for a similar property.

Annual rent increase

AU avg ~3.5% p.a.

Investment portfolio (alternative to buying)

Asset classAlloc %Return %

Australian shares (ASX)

International shares

Bonds

Gold

Cash / HISA

Crypto

Total: 100%Weighted return: 6.70% p.a.

General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.

From the Mate Network

Calculate Your Take Home Pay →

Know your after-tax income before deciding how much to invest or borrow.