Buy vs Rent Calculator

The calculation compares: (1) Total cost of buying = Down payment + EMIs over the period + Maintenance + Property tax + Transaction costs (stamp duty, registration) - minus property value appreciation; (2) Total cost of renting = Rent payments over the period + Rent increases - minus returns earned by investing the down payment amount elsewhere. If total buying cost < total renting cost over your intended stay period, buying is financially better.

Generally, buying becomes cheaper than renting when you stay in the same property for 4-7 years (the "break-even period"). In the first few years, buying costs more due to stamp duty, registration, and high interest portions of EMIs. Over time, rent increases (typically 5-10% annually in Kolkata) while your EMI stays fixed, and property appreciation builds equity - eventually tipping the balance in favour of buying. The exact break-even point depends on property price, rent, appreciation rate, and interest rate.

Beyond the EMI, homeowners pay: (1) Monthly maintenance: ₹2-8/sqft (₹2,000-8,000 for a 1,000 sqft flat); (2) Property tax: ₹5,000-20,000/year in Kolkata; (3) Insurance: ₹5,000-10,000/year; (4) Repairs and upkeep: 1-2% of property value annually; (5) Society charges and corpus fund contributions; (6) Opportunity cost of the down payment (returns you could have earned investing that money elsewhere). Renters avoid all these but face annual rent increases.

This strategy (renting + investing the money you would have spent on down payment and EMI-minus-rent) can work if you consistently earn 12%+ returns. However, it requires discipline (actually investing the difference), and equity market returns are not guaranteed. Real estate provides leverage (you control a ₹1 crore asset with ₹20 lakh), forced savings through EMI, and inflation hedging. In Kolkata's appreciating market (13.1% in Q2 2026), buying has been the historically better choice for most residents.