Rent vs Buy Calculator
Should you rent or buy? Compare the wealth you build by buying — property value minus the loan — against renting and investing your down payment, live on one screen.
- Free — no sign-up
- Instant, on-screen results
- Built by our CA · CS team
- Rules cited on the page
Enter your figures — the result on the right updates as you type.
Wealth breakdown
Get a home-loan & tax plan from a CA
We map your loan interest (Sec 24b), 80C principal and the rent-vs-buy tax angle before you commit.
Disclaimer: Indicative model using fixed rent-growth, investment-return and maintenance assumptions. Real outcomes depend on your city, actual returns, taxes, stamp duty and how long you stay. Not investment advice.
Renting is not "wasting money" — it's an opportunity cost
The real question is never "rent or buy" in isolation — it's which choice leaves you wealthier after the years you actually plan to stay. Buying builds equity in an appreciating asset, but locks up your down payment and adds EMI, maintenance and property tax. Renting is cheaper month-to-month, freeing that down payment to be invested. This calculator compares the net wealth of both paths side by side.
Worked example — the default numbers
A ₹60,00,000 home with a ₹12,00,000 down payment, a ₹48,00,000 loan at 8.5% over 20 years, versus renting a similar home at ₹18,000/month. Property appreciates 6% a year; you compare over a 10-year horizon.
Rent vs Buy over 10 years
Key terms explained
Opportunity cost
The return you give up by locking money into a home instead of investing it. A ₹12L down payment growing at 8% becomes ~₹25.9L in 10 years — that forgone growth is the true "cost" of buying, not just the EMI.
Appreciation vs EMI
Buying works because appreciation applies to the whole property value, while your down payment is only a slice of it. This leverage is why a modest 6% appreciation can beat an 8% return on a smaller invested sum.
EMI vs rent
An EMI is far higher than rent early on, but it's part principal — money that becomes your equity. Rent is a pure expense. The gap between EMI+upkeep and rent is exactly what a renter can invest each month.
Horizon matters
Buying has heavy upfront and exit costs, so it needs time to pay off. Over 3–5 years renting often wins; stretch to 10+ years and appreciation plus equity usually tips it toward buying.
Questions people ask
Short answers on Rent vs Buy Calculator. Tap a question to open it.
01How do I decide between renting and buying?
Compare the total cost of each over the period you expect to stay, and the wealth you end up with. Buying involves the down payment, EMI, stamp duty, maintenance and property tax; renting involves rent and the returns on the money you did not put into a down payment.
02What is the rent-to-price ratio and why does it matter?
Annual rent divided by property price. In many Indian cities it is 2% to 3%, well below home loan rates, which means the interest alone often exceeds the rent — the arithmetic case for buying then rests on capital appreciation.
03How long should I plan to stay before buying makes sense?
Long enough to recover the transaction costs — stamp duty, registration and brokerage can be 7% to 10% of value on the way in and out. Under five to seven years, renting is usually financially better.
04Do tax benefits change the answer?
They help under the old regime, where section 24(b) interest and 80C principal reduce the effective cost. Under the new regime a self-occupied house gets no interest deduction, which meaningfully narrows the gap.
05What non-financial factors matter?
Job mobility, school stability, the emotional value of ownership, and the risk of being a forced seller. These often outweigh the spreadsheet, and it is legitimate for them to.
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Disclaimer: This tool gives indicative results for general guidance only and is not professional advice. Please verify with a qualified CA before acting on the numbers.