Should I Rent or Buy a House?
This simple calculator helps you compare the costs of renting versus buying a home.
How to use this calculator:
- Enter your current or expected monthly rent
- Enter the price of the home you want to buy
- Enter how much down payment you can make
- Enter the loan period and interest rate
- See the results and comparison between renting and buying
This is the amount you currently pay or expect to pay as monthly rent
The total purchase price of the home you are considering buying
The initial payment you make when buying a home (typically 20% of the home price)
How many years you plan to take to repay the home loan
The annual interest rate on your home loan (currently around 8-9% in India)
Note: We assume a 5% annual increase in rent and a 5% annual appreciation in property value for this calculation.
Renting may be better for you
per month for 20 years
assuming 5% annual rent increase
down payment + EMIs + maintenance for 25 years
Cost Comparison Over Time
This graph shows how your costs and home value change over 25 years. When the green line (Home Value) rises above the red line (Total Buying Cost), buying becomes profitable.
If You Buy:
- You'll pay: Down payment + EMIs + maintenance costs
- You'll gain: A property that likely increases in value over time
- Good if: You plan to stay in one place for many years
If You Rent:
- You'll pay: Monthly rent (which typically increases each year)
- You'll gain: Flexibility to move and no maintenance headaches
- Good if: You might need to relocate or want to avoid repair costs
Simple Rule of Thumb:
If you plan to stay in the same place for at least 5-7 years, buying often makes financial sense. Otherwise, renting gives you more flexibility.
Disclaimer: The results provided by this SIP and Lumpsum calculator are for informational purposes only and do not constitute financial advice. Please consult a certified financial advisor before making any investment decisions.