Rent vs Buy Calculator
Compare the total cost of renting versus buying a home over a chosen time horizon.
- Free to use
- Accurate results
- No registration required
- Works on all devices
Your result
Buying
Cheaper option
AI explanation
Formula
Renting: total escalating rent paid, net of investment growth on the down payment. Buying: total EMI paid plus down payment, minus the home's appreciated valueWorked example
₹25,000 rent, ₹60L home, ₹12L down payment, 10-year horizon
| Field | Value |
|---|---|
| Current monthly rent | 25000 |
| Annual rent escalation | 5 |
| Home price | 6000000 |
| Down payment | 1200000 |
| Home loan interest rate | 8.5 |
| Loan tenure | 20 |
| Expected home appreciation | 5 |
| Expected return if renting (investing the down payment) | 10 |
| Comparison horizon | 10 |
| Cheaper option | Buying |
| Net cost of renting | 1860876.81 |
| Net cost of buying | -3574705.94 |
Assumptions
- A simplified comparison — does not model property tax, maintenance, brokerage/registration costs, home insurance, or tax deductions available on either side (HRA for renting, home loan interest/principal deductions for buying).
- Assumes the EMI stops once the loan tenure ends, even if the comparison horizon is longer.
- Real estate and investment returns both carry uncertainty that this simplified model doesn't capture.
Frequently asked questions
Is buying always cheaper than renting long-term?
Not necessarily — it depends heavily on your specific rent, home price, appreciation expectations, loan rate, and how you'd otherwise invest the money used for a down payment and higher housing costs. Run your own numbers rather than assuming either is always better.
What costs does this calculator NOT include?
Property tax, maintenance, society charges, home insurance, brokerage/registration/stamp duty on purchase, and tax deductions available on either side (HRA for renters, home loan interest/principal deductions for buyers) — all of which can meaningfully shift the real comparison.
Why might renting show a lower "net cost" here?
If the money you'd otherwise put toward a down payment grows well when invested instead, and the home doesn't appreciate fast enough to offset the EMI cost, renting can come out ahead in this simplified model — try different assumptions to see how sensitive the result is.
Related calculators
Sources
- Master Direction – Reserve Bank of India (Regulatory Framework for Housing Finance Companies) — Reserve Bank of India. Effective 17-02-2021, reviewed 13-09-2026.
This calculator provides a simplified estimate only and does not constitute financial or real estate advice. Consider all costs, taxes, and personal circumstances before deciding.
Report a calculation issue