Why high rents are pushing Sydney renters towards buying
Sydney’s rental market remains under pressure, and for many long-term renters, that reality is reshaping the buy-versus-rent equation.
According to Domain’s latest Rent Report, rents across Sydney ended 2025 at record highs, despite growth moderating towards the end of the year. Median house rents sit around $800 per week, while unit rents are $750 per week, keeping housing costs high for tenants.
Vacancy rates also remain well below balanced levels. Sydney’s vacancy rate is around 1.4%, compared with the 3% required for a balanced market. Conditions are particularly tight in many middle and outer-ring suburbs, where demand continues to build.
At the same time, rental affordability is stretched, with renters now spending around 27.7% of their income on housing, according to the Real Estate Institute of Australia. This limits the ability to save, even for higher-income households.
Why does this matter for aspiring homeowners?
High rents cut both ways. While they make saving harder, they also narrow the gap between rent and potential mortgage repayments.
In many cases, monthly rent is now close to or comparable to mortgage repayments, particularly for lower-entry point options like apartments or townhouses. Let’s look at the numbers.
Using Sydney’s median unit price of $844,390 and assuming you have a 20% deposit, an 80% loan equates to about $675,500. At a variable rate of 5.20% p.a. over 30 years, repayments are roughly $3,700 per month, or $855 per week.
By comparison, the median weekly rent for a Sydney unit is around $750, or $3,250 per month.
This example uses indicative variable rates based on current market averages from money.com.au.
This comparison also assumes a standard 20% deposit. In reality, some buyers may be able to enter sooner with a smaller deposit through government support or family assistance.
Based on these numbers, the case for buying instead of renting becomes more and more appealing. That cash flow – currently disappearing into a landlord's pocket – could instead be building equity in your own property.
How to enter the Sydney property market sooner
You may choose to start with apartments, townhouses or homes in outer-ring suburbs where price points are more accessible.
Government schemes, such as the 5% Deposit Scheme, help eligible first home buyers reduce upfront costs by allowing them to enter the market with a smaller deposit. These programs can make buying sooner possible, without having to wait years to save a large deposit.
Guarantor support from family members is another option. A family member can guarantee part of your loan, helping you meet lender requirements and access a higher loan amount. This support can turn homeownership from an aspirational goal into a realistic step, while still allowing you to gradually build equity and independence in your own property.
If rising rents have you questioning whether it’s time to buy, expert lending advice can make all the difference. Eventus Financial is an award-winning Sydney mortgage broker with over 400 five-star Google reviews. Schedule a no-obligation consultation with Alex to see what’s possible.