Buy vs Rent in India: What the Calculator Actually Tells You
Buying is not automatically better than renting in India. The break-even point depends on yield, rate and how long you stay — and a calculator settles it in a minute.
PropertyPilot Research Desk
Market data and rental research
9 min read
The two costs people compare wrongly
Rent is not wasted money and an EMI is not all savings. The fair comparison is rent plus the return you earn on your un-spent down payment, against interest plus maintenance plus property tax plus the transaction costs you can never recover. Only the principal portion of your EMI builds equity.
In most Indian metros gross rental yields sit between 2.5% and 4%, while home loan rates sit meaningfully higher. That gap is why the calculator often favours renting over short horizons.
Transaction costs set the break-even horizon
Stamp duty, registration, brokerage and the eventual selling cost typically total 8–12% of the price round-trip. Spread over three years that is crushing; spread over ten it is minor. As a rule of thumb, if you are confident of staying seven years or more in the same city, buying usually wins in the model. Under four years, renting usually does.
- Test capital growth at 3%, 5% and 7% — do not assume one number
- Include society maintenance and property tax on the buy side
- Include rent escalation of 5–8% a year on the rent side
Run it for your own city
Prices and rents diverge sharply between Indian markets, so a national answer is meaningless. Open the buy vs rent calculator with your city's price-per-sq-ft and rent-per-sq-ft from our city pages, then change only the horizon. The year at which the lines cross is your answer.