The Shoalhaven is bucking the trend when it comes to the diminishing gap between paying down a new mortgage and paying rent.
According to the newly released 'Buy vs Rent Report 2020' by Aussie Home Loans, the gap between the two is lessening across most non-metro areas of New South Wales.
The areas of regional New South Wales where repaying a mortgage is substantially cheaper than renting include the Far West, the Riverina region and the New England/North West region of New South Wales where rental costs are high relative to the value of homes.
However the largest regional centres, including the Shoalhaven and Illawarra are at the other end of the spectrum.
The value of housing is typically higher relative to rents.
Mortgage repayments, based on the discounted variable mortgage rate for houses across the Illawarra region are around $480 more each month than renting.
"We are seeing very strong demand from first home buyers and families keen to leave Sydney."Wayne Bourke
Aussie Home Loans has opened a new store in Vincentia to focus on the booming South Coast market. It's the second store of franchisee Wayne Bourke, who has lived in the area for more than 20 years.
"We are seeing very strong demand from first home buyers and families keen to leave Sydney," he said.
"The pandemic has led many people to reassess their priorities and also realise that if they can work from home they can work anywhere - why not live by the beach with a friendly village atmosphere?
Mr Bourke said the new Princes Highway upgrade had made the trip to Sydney faster and safer and Vincentia now had all the shops and community facilities people need.
"We are also seeing lots of new homes going up as the area transitions from rural to semi-rural and urban," he said.
Two years ago typical mortgage repayments for a house in non-metro New South Wales (based on discounted variable mortgage rates) were about $415 more each month than paying rent.
By September 2020 the difference had more than halved to $201/month and fixed rate mortgage repayments are now less than rental payments.
The difference between renting and paying a mortgage is mostly a factor lower interest rates.
The change in house values and rental rates has been similar over the past two years, with the median house value rising by 5.7 per cent while the median rental rate is up by a slightly lower 5 per cent.