Compare the total 10-year or 20-year cost of renting (and investing the difference) against buying a home on loan. Uses real rental yields, stamp duty, and Indian tax rules.
Buying a home with a loan is often seen as a financial milestone, while renting is frequently viewed as wasted money. In reality, the decision between renting and buying is a long-term financial comparison, not an emotional one.
This Rent vs Loan Calculator helps you compare two practical scenarios:
The tool focuses on long-term wealth outcomes based on your actual numbers.
This Rent vs Buy Calculator compares scenarios based on multiple market assumptions. It uses three scenarios (pessimistic, base case, optimistic) to provide a range of possible outcomes rather than a single prediction.
This tool is for educational purposes only. Actual outcomes depend on market conditions, location, and personal circumstances. Consult a qualified financial advisor before making major financial decisions.
Enter the property price and your current rent. We'll analyze multiple scenarios for you.
= Fifty Lakh Rupees
Total cost of the property you're considering
= Twenty Thousand Rupees
What you're paying in rent today
Moderate range — detailed analysis recommended.
Enter tenure between 5-30 years. You can type directly or use ↑↓ arrows.
Percentage of property price paid upfront
Check this if you've already calculated or received an EMI quote
Society maintenance, property tax, etc.
Annual increase in maintenance costs
LTCG tax on equity investments (typically 10-12.5%)
You can skip the Assumptions step if you want to use our recommended market estimates. Click "Next" to proceed to the analysis.
This calculator compares renting versus buying a house with a home loan by considering real financial inputs such as rent, EMI, interest cost, and investment returns.
Instead of assuming home ownership is always better, it answers one key question: Where does your money grow more over time – renting and investing, or buying a home with a loan?
Most rent vs buy discussions ignore opportunity cost.
When you rent:
When you buy a house with a loan:
This calculator places both choices on equal financial terms.
The Rent vs Loan Calculator allows you to customize the comparison using realistic inputs such as:
These inputs reflect real housing and loan decisions faced in India.
After calculation, the tool shows:
This helps you evaluate whether renting and investing creates more long-term wealth than owning a house through a loan.
This calculator is useful if you are:
This tool focuses only on financial outcomes.
It does not account for emotional factors such as pride of ownership, lifestyle preferences, or personal stability. Those factors are subjective and personal. This calculator helps you evaluate the numbers objectively.
Use the SIP Calculator to estimate your investment returns while renting, or try the Home Loan Prepayment Calculator to see how prepayments can reduce your loan burden. For business needs, check out our GST Invoice Generator.
Decided to buy a home with a loan? Maximize your savings with our Home Loan Prepayment Calculator! Discover how strategic prepayments (Monthly SIP, Annual Lump Sum, or Step-Up) can save you lakhs in interest and reduce your loan tenure by several years. See the "painful truth" of compound interest and learn how small extra payments can destroy debt early.
A ratio above 20 generally means renting is financially better. Below 15, buying becomes more compelling. Source: Anarock Research, NoBroker Rental Yield Report 2025.
| City | Avg. Gross Rental Yield | Price-to-Rent Ratio | Verdict |
|---|---|---|---|
| Mumbai (suburbs) | 2.5–3.0% | 33–40× | Rent |
| South Delhi | 2.5–3.0% | 33–40× | Rent |
| Bengaluru | 4.0–4.5% | 22–25× | Lean Rent |
| Hyderabad | 3.5–4.0% | 25–29× | Lean Rent |
| Pune | 3.0–3.5% | 29–33× | Lean Rent |
| Chennai | 3.5–4.0% | 25–29× | Borderline |
| Ahmedabad | 4.0–5.0% | 20–25× | Borderline |
| Tier-2 cities | 5.0–7.0% | 14–20× | Consider Buying |
These are one-time sunk costs paid at purchase. On a ₹1 Cr property in Mumbai, stamp duty alone is ₹6 lakh. Source: respective state government stamp duty schedules (2025).
| State | Stamp Duty (Men) | Stamp Duty (Women) | Registration Fee | Total on ₹1 Cr |
|---|---|---|---|---|
| Maharashtra | 6% | 5% | 1% | ₹7 lakh |
| Delhi | 6% | 4% | 1% | ₹7 lakh |
| Karnataka | 5% | 5% | 1% | ₹6 lakh |
| Telangana | 4% | 4% | 0.5% | ₹4.5 lakh |
| Tamil Nadu | 7% | 7% | 1% | ₹8 lakh |
| Rajasthan | 6% | 5% | 1% | ₹7 lakh |
| Gujarat | 4.9% | 4.9% | 1% | ₹5.9 lakh |
Total outflow = down payment + EMIs over tenure + stamp duty & registration + annual property tax + maintenance. At the end, the property is valued using an assumed appreciation rate (default: 7% per year). Net worth = property value − outstanding loan balance − (taxes on capital gains if sold).
Total outflow = rent payments (grown at rent inflation rate, default 5%/year) + renter's insurance. The down payment amount that would have gone into the property is instead invested in a diversified portfolio. Each month, the difference between EMI and rent is also invested. Net worth = investment corpus after tax (LTCG 12.5% above ₹1.25 lakh per year).
The scenario with higher net worth at the end of your chosen horizon is the financially superior choice — but non-financial factors (security, stability, emotional value of ownership) are yours to weigh.
It depends on the price-to-rent ratio in your city. In Mumbai, where property prices are 35–40× the annual rent, renting and investing the surplus is mathematically superior over a 10-year horizon. In smaller Tier-2 cities where ratios are 15–18×, buying makes more sense. This calculator shows the break-even point for your specific inputs.
As of 2025–26, gross rental yields vary significantly: Bangalore ~4.0–4.5%, Hyderabad ~3.5–4.0%, Pune ~3.0–3.5%, Mumbai suburban ~2.5–3.0%, South Delhi ~2.5–3.0%. Higher yields indicate a more favourable buying scenario.
Price-to-rent ratio = property price ÷ annual rent. A ratio below 15 generally favours buying; 15–20 is borderline; above 20 means renting and investing the difference is financially better. Most major Indian metros have ratios of 25–40, making renting mathematically superior unless you factor in long-term appreciation.
Stamp duty varies by state: Maharashtra 6% (women 5%), Delhi 6% (women 4%), Karnataka 5%, Telangana 4%, Tamil Nadu 7%. Registration fee is typically 1% of property value. On a ₹1 Cr flat in Mumbai, you pay approximately ₹7 lakh (6% + 1%) upfront — this sunk cost must be included in buy vs rent comparison.
Under the old tax regime, Section 24(b) allows ₹2 lakh deduction per year on home loan interest for a self-occupied property. Under the new tax regime (default from FY 2024-25), this deduction is NOT available. For a let-out property, actual interest paid can be deducted under both regimes.
Yes. If you live in a rented home and receive HRA from your employer, you can claim HRA exemption under the old tax regime — subject to 40%/50% of basic salary city limit. This HRA benefit reduces your effective rent cost, which can shift the comparison in favour of renting. Under the new tax regime, HRA exemption is not available.
Conservative estimates: Nifty 50 index fund long-term CAGR 12–14%, balanced hybrid fund 10–11%, debt fund 7–8%. The calculator defaults to 11% which reflects a 60:40 equity-debt blend. You can adjust this to see how different return assumptions change the outcome.
Beyond EMI: stamp duty + registration (6–8% of value), property tax (0.1–0.5% per year), maintenance charges (₹3–10/sq ft/month in housing societies), home insurance (~0.1% per year), major repairs/renovation every 8–10 years. This calculator includes most of these in the cost comparison.
This calculator is for informational and educational purposes only. Results are estimates based on the assumptions you provide and may not reflect actual returns. Please consult a SEBI-registered financial advisor before making investment or property decisions.