Accommodation is a big issue when studying in Australia, most of Chinese students tend to rent properties when studying in Australia, is it really a good idea? Let’s compare the pros and cons of buying and renting to find out which way works better.
1. Rent or buy a home
If international students choose to rent a home in Australia , even if they may just rent a single room from a property, he still pays tens of thousands of Australian dollars for rent till he finish his course.
A typical house in Australia, with front and backyard and private parking, may costs less than 700,000 Australian dollars in Australia. Buyers only need a down payment of 20% and the rest can be covered by mortgage. Applying for mortgage and purchasing properties in Australia is convenient and the interest rate is not high. Compared with China, income in Australia can cover repayment much better.
Instead of paying rent for years and own nothing afterward, purchasing a home seems to be more rewarding. Think about the property value appreciation and permanent home ownership.
2. Easy to be an“International landlord”
If students choose to retain ownership of their property after return to their home country, they can entrust real estate agents to manage their property and be an “international landlord”.
Vacancy rate in Australia property market is very low (Australia housing vacancy rate is about 0.6%). Rental return is considerable with residential return around 4 to 5 per cent per annual. Rental return is stable since real estate agencies are governed by professional code of conducts and regulation.
3. Potential Resale Return
People may think buying a property may be a good idea only if students intend to stay in Australia. That’s not the whole story.
Even if the owner is overseas, their properties can benefit them in two different ways: rental return and resale.
According to the statistics, Australian real estate property appreciates for nearly 40 years with price double in every 7-10 years. The average annual growth rate is about 10%. In other words, if a student sells his property before leaving Australia, he may potentially earn 100,000 Australia dollars given he holds his home for at least three years.