Home owners who bought property six months ago are up to $180,000 better off than if they had invested their savings in the sharemarket or a term deposit, new analysis reveals.
New research undertaken by Canstar shows that if a Sydneysider bought a house for the median price of $1,112,671 in March with a 20 per cent deposit of $222,534 the value of their property would have risen by 16.3 per cent – or by a huge $181,365 – by last month.
The same 20 per cent deposit invested in a six-month term deposit at the highest interest rate at the time of 0.99 per cent would have earned just $2203 in comparison – a difference of $179,162 over six months.
Alternatively, if the same amount was invested in the Australian sharemarket, the shares would have grown 10.02 per cent in the six-month period, earning $22,298.
It was a similar story in Melbourne, where a home owner who invested in a house with a 20 per deposit of $171,819 based on the median price of $859,097 back in March would have gained a 10 per cent rise of $85,910 by September.
If the same amount was placed in a term deposit, savers would have earned just $1701 in comparison – a difference of $84,209 over the six-month period.
Melbourne savers would have been better rewarded if they invested their 20 per cent deposit in the sharemarket over that six-month period, which would have grown in value by $17,216.
Brisbanites would have gained a 13.2 per cent increase – or $80,252 – in their house values if they invested a 20 per cent deposit in the median house price of $607,969 back in March.
If they invested the same amount – $121,584 – in a six-month term deposit at the highest interest rate, savers would have just $1204 by September. That is a difference of $79,048.