Should you rent or buy? This rent vs buy calculator compares the true cost of owning a home — EMI, down payment opportunity cost, maintenance, property tax, insurance and selling costs — against renting and investing the difference, over the number of years you plan to stay.
It shows the break-even year when buying overtakes renting, the net worth under each path, and how sensitive the answer is to rent growth, home-price appreciation and investment returns, so the decision rests on your numbers rather than a rule of thumb.
How to use the rent vs buy calculator
- 1Enter the home price, down payment, loan rate and tenure.
- 2Enter your current rent and expected annual rent increase.
- 3Set home-price appreciation, investment return on savings and how long you plan to stay.
- 4Compare total cost, net worth and the break-even year; save scenarios to compare cities or properties.
Rent vs Buy Calculator — frequently asked questions
Is it cheaper to rent or buy?
It depends on price-to-rent ratio, how long you stay, loan rate and what your savings could earn elsewhere. As a rough guide, buying tends to win when annual rent exceeds 4–5% of the home price and you stay 7+ years.
What is the price-to-rent ratio?
Home price ÷ annual rent. Below 15 usually favours buying; above 20 favours renting. Many Indian metros sit at 30–50, which is why renting often wins financially there.
What costs of ownership do people forget?
Stamp duty and registration, brokerage, maintenance (1–2% of value a year), property tax, insurance, society charges and the return you could have earned on the down payment.
How is the break-even year calculated?
It is the first year in which the owner's net worth (home equity minus costs) exceeds the renter's net worth (invested savings), using the growth rates you enter.
Does it account for tax benefits?
Yes — enter the annual tax saving on home-loan interest and principal (e.g. Sections 24 and 80C in India, or mortgage-interest deductions where applicable).