Buy vs Rent Calculator (First-Party Comparison)
Compare 5/10/20-year total cost of buying vs renting a home with EMI, taxes, maintenance, appreciation, and rent escalation. NPR / INR / PKR.
Buy assumptions
Rent assumptions
5 / 10 / 20-year side-by-side comparison
| year | buyTotal | rentTotal | difference | recommendation |
|---|---|---|---|---|
| 5 years | NPR 1,28,30,893 | NPR 20,49,227 | NPR 1,07,81,666 | Rent |
| 10 years | NPR 1,59,22,166 | NPR 45,88,041 | NPR 1,13,34,124 | Rent |
| 20 years | NPR 2,28,96,919 | NPR 1,19,63,743 | NPR 1,09,33,175 | Rent |
How this works
We compare the cumulative cash spent on each track at three planning horizons (5, 10, and 20 years) and report the difference and recommendation per horizon.
buyCost(y) = downPayment + emiPaid(y) + (taxPct + maintPct)/100 × price × y
rentCost(y) = (esc=0) ? rent × 12 × y
: rent × 12 × ((1+esc)^y − 1) / esc
+ securityDeposit
where y ∈ {5, 10, 20}, esc = rentEscalation/100emiPaid(y) is the total EMI paid through year y, computed by running the standard reducing-balance EMI formula at a tenure of y × 12 months — the same formula used by our Mortgage / EMI Calculator.
The buy total is gross cash out: it does not subtract the property's market value at year y. The appreciated property value is shown separately so you can layer your own net-position comparison on top.
Break-even year is reported only when the difference buyCost − rentCost changes sign across the three horizons. We linearly interpolate between the two horizons that bracket the zero crossing.
Worked example
Property at NPR 1,00,00,000, 20% down, 9.5% loan over 240 months, property tax 0.5%/yr, maintenance 1%/yr, appreciation 5%/yr; rent at NPR 30,000/month with 5% escalation and a 2-month security deposit.
- Down payment =
1,00,00,000 × 20% = NPR 20,00,000 - EMI on NPR 80,00,000 over 240 months at 9.5% ≈
NPR 74,571 / month - Buy total at year 20 ≈ down payment + 240 × EMI + 1.5%/yr × 1,00,00,000 × 20
- Rent total at year 20 ≈
30,000 × 12 × ((1.05)^20 − 1) / 0.05+ 60,000 deposit
Adjust the appreciation rate or rent escalation by a couple of percent to see how quickly the recommendation can flip — both are sensitive levers in this comparison.
Sources
- Standard reducing-balance EMI formula (Equated Monthly Instalment)
- Geometric series for cumulative escalating rent
FAQ
What does 'total cost' mean for the buy and rent tracks?
Buy total is the sum of the down payment, the cumulative EMI paid through the chosen horizon, and the cumulative property tax plus maintenance over those years. Rent total is the cumulative rent paid (compounding at the rent escalation rate) plus the security deposit. Both are 'cash out the door' totals — they do not include the resale value of the property or the opportunity cost of the down payment, both of which are calculator-independent decisions you should layer on top.
Why does the table only show 5, 10, and 20 year horizons?
Real-estate decisions tend to cluster around three planning windows: a short-term hold (around 5 years), a medium-term hold (around 10 years), and a long-term hold (around 20 years, which also matches the typical home-loan tenure in NPR/INR/PKR markets). Showing three fixed horizons keeps the comparison legible without burying the headline numbers in a 20-row table.
How is the break-even year estimated?
The calculator looks at the difference between buy total and rent total at each of the three horizons. If the difference changes sign between two consecutive horizons (for example positive at year 5 and negative at year 10), the break-even point is estimated by linear interpolation between those two horizons. If the difference never crosses zero across 5 to 20 years, no break-even is reported and one track dominates over the entire window.
Does the buy total include the future resale value of the property?
No. The buy total reported here is gross cash spent — down payment, EMI, taxes, and maintenance — not net of the property's market value at the end of the horizon. The appreciation rate input is used for context (the property value at each horizon is shown separately) but is intentionally not subtracted from the buy total. To compare net positions, mentally subtract the appreciated value from the buy total before comparing.
Does changing the currency convert NPR to INR or PKR?
No. The currency selector is a labelling change only. The numeric figures stay exactly the same — only the currency code in front of them changes. This calculator does not perform any foreign-exchange conversion. Enter the property price, rent, and loan rate in the currency you actually plan to transact in.
How is this different from the third-party Buy vs Rent calculator linked elsewhere on the site?
The third-party calculator opens an external tool that runs its own model. This first-party version runs entirely in your browser, uses the same EMI formula as our Mortgage / EMI Calculator, and lets you share the exact inputs via a URL. There is no FX conversion, no signup, and no data leaves your device.