Rent vs buy: the real maths.
Buying a ₹80.0 L home instead of renting at ₹28,000/month, the buyer's net worth overtakes the renter's around year 10+. Before that, renting and investing the ₹20.8 L down-payment-plus-stamp-duty usually wins. Time in the home is the whole game.
The honest comparison
"Rent is money down the drain" and "buying is always better" are both half-truths. The fair way to compare is to assume both people spend the same amount each month: the buyer on EMI, maintenance and upfront costs; the renter on rent, with every rupee of difference invested. Then track each person's net worth over time. Below is exactly that simulation for a ₹80.0 L home (20% down, 8.5% loan over 20 years, 6% stamp duty, 6%/yr appreciation) versus a ₹28,000/month rental rising 7%/yr, with the renter's portfolio compounding at 10%.
| After year | Buyer net worth | Renter net worth | Winner |
|---|---|---|---|
| Year 1 | ₹22.1 L | ₹26.9 L | 🔑 Rent |
| Year 3 | ₹35.5 L | ₹40.5 L | 🔑 Rent |
| Year 5 | ₹50.7 L | ₹56.0 L | 🔑 Rent |
| Year 7 | ₹68.0 L | ₹73.7 L | 🔑 Rent |
| Year 10 | ₹98.5 L | ₹1.05 Cr | 🔑 Rent |
The pattern is almost always the same shape: the renter leads early (because the buyer's ₹20.8 L upfront and front-loaded interest haven't been recovered), and then the buyer pulls ahead as equity builds and appreciation compounds, crossing over around year 10 and widening after. By year 10 the buyer is at ₹98.5 L versus the renter's ₹1.05 Cr. Change the inputs (a cheaper home, a bigger rent, faster appreciation) and the crossover moves, but the shape holds.
The one number that decides it
How long you'll stay. Every other variable is secondary to the holding period, because the upfront costs of buying (stamp duty, registration, and the interest-heavy early years) only pay off with time. If there's a real chance you'll move within 3-5 years (a job change, a growing family, a city you're not sure about), the maths and the flexibility both favour renting. If you're planting roots for 7+ years, buying's forced-saving and appreciation usually win. Don't buy for the investment return; buy for the stability, and let the return be a bonus.