Loading…
Loading PaisaToolsLoading…
Loading PaisaToolsShould you rent or buy a home? See which leaves you richer
Reviewed by the PaisaTools Editorial Team · Last reviewed September 2026
How to use: Enter the home price, your rent, loan terms and how long you'll stay — we run a net-worth comparison and tell you whether to rent or buy, with the break-even year.
Example₹80 lakh home, ₹25,000 rent, staying 10 years → see whether buying or renting-and-investing leaves you richer
The all-in price of the home you'd buy
The rest is your home loan
Typical home-loan rates are around 8–9%
What you'd pay to rent the same kind of home today
The single biggest factor — the longer you stay, the more buying wins
How much the property's value rises each year
What you'd earn investing the money instead (e.g. index funds ~11–12%)
Renting wins by ₹24,35,708
Over 10 years, renting & investing the difference leaves you about ₹24,35,708 richer.
“Renting wins” assumes you invest the money you didn't spend on a down payment and EMI. If you'd just spend it instead, buying is the safer way to build wealth.
₹1,10,21,548
₹1,34,57,256
✓ Better outcome
Net worth after 10 years — home equity plus any money you invested along the way.
The numbers behind it
The break-even point is the real answer: if you'll stay longer than that, buy; shorter, rent and invest the difference.
Check how much home loan your salary supports“Should I rent or buy?” is one of the biggest money decisions you'll make — and the usual advice (“rent is wasted money”) is too simple. This calculator settles it with a year-by-year net-worth race: it puts a buyer and a renter on the same starting wallet and follows both forward.
The buyer sinks the down payment and buying costs into a home and pays an EMI; the renter invests that same cash and pays rent. Each month, whoever spends less invests the difference. At the end of the period you'd actually stay, it compares net worth — home equity for the buyer versus an invested portfolio for the renter — and declares a winner, plus the break-even year where buying pulls ahead.
The takeaway is almost always about time horizon: if you'll stay longer than the break-even, buy; if shorter, rent and invest the gap. Once you have your answer, check how much loan your salary supports with the home loan eligibility calculator and the exact EMI with the EMI calculator.
The comparison runs a monthly simulation: the buyer's equity grows as the loan amortises (standard EMI formula) and the home appreciates, while both parties invest any monthly cash-flow surplus at the expected investment return. Fixed assumptions — rent inflation 7%/yr, owning cost (maintenance + property tax) 1%/yr of value, buying cost 7% upfront, selling cost 1.5% — reflect typical Indian market norms and can be refined as your situation differs. Income-tax benefits on home-loan interest and principal are excluded, making the result conservative toward buying. This is an educational model, not financial advice.
Free for any site. One line of HTML, no signup, no ads, and we keep the rates and rules current so you never have to.