REIWA and Curtin University have launched a Buy-Rent Index, which can determine the best time to buy or rent real estate in Perth.

The Index will be released on a quarterly basis and is based on economic assumptions that help to identify the annual house price growth rate required for home ownership to be more financially advantageous than renting.

Click here to view the Buy-Rent Index for the June quarter.

The June quarter 2017 figures indicate the median house price in Perth would need to appreciate by 4.3 per cent annually over the next 10 years for the purchase of a house to be considered financially viable over renting at the median rent.

Since 2002, Perth’s annual growth rate in the median house price has been 6.9 per cent.

REIWA CEO Neville Pozzi said the REIWA was thrilled to have collaborated with Curtin University to help educate and inform the public on the costs and benefits of home ownership versus renting.

“Curtin’s vast academic knowledge has enabled us to harness our research capabilities to produce this helpful tool. In the current economic and property climate, we recognise it can be difficult for West Australians to determine whether or not they should buy or rent. This Index will provide prospective home owners and renters with an insight into whether it is a good time to buy or rent based on trends in the current market.

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J-Han Ho, a Property Researcher and Senior Lecturer in the School of Economics and Finance at Curtin Business School, said the Index aimed to help Perth households make an informed decision about buying or renting a home.

"We understand the difficulties of housing affordability and therefore hope the Buy-Rent Index will make it a little easier for households to make an informed decision,” Ho said.

“Many households only focus on the location and price of the property when looking to buy, but this shows there are many other factors that need to be considered including interest rates, opportunity cost of capital and the property being a long-term investment. Buying at the right time can achieve a superior outcome to buying in the right location.”

Figures for the September quarter Buy-Rent Index will be released late December 2017.

Click here to view the Buy-Rent Index for the June quarter.

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