Rent vs Buy Calculator: House Ownership vs Wealth Creation

Compare the true financial trade-offs between taking a home loan to buy real estate versus renting an apartment and investing your surplus savings into mutual funds or equity SIP.

Real Estate & Investment Assumptions

Target Property Price₹75.0 L

Monthly Rent for Similar Home₹ 22,000

Home Loan Interest Rate8.5%

Expected Real Estate Growth6% / yr

Alternate Investment Return (SIP)12% / yr

Time Horizon20 Years

Buying Strategy

Monthly Loan EMI

₹ 52,069 / mo

Down Payment (20%): ₹15.0 L

Estimated Property Value after 20 Yrs

₹ 2,40,53,516

Renting + SIP Strategy

Higher Net Worth

Monthly Rent

₹ 22,000 / mo

Monthly Savings Invested in SIP: ₹ 30,069

Accumulated Mutual Fund Wealth after 20 Yrs

₹ 4,45,13,212

Strategic Takeaway: In Indian metros where rental yields are low (2.0% - 3.0%), Renting and investing your surplus into mutual funds generates ₹ 2,04,59,696 more total net worth after 20 years because equity compounding (12%) compounds faster than physical real estate (6%).

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