Rent vs Buy Calculator — Should You Rent or Buy in Pakistan?
Compare the true cost of renting vs buying over up to 30 years: mortgage payments, rent increases, property appreciation and investment returns — with a break-even year.
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Buying Renting break-even
How this is calculated
- Buying: down payment + every monthly mortgage payment, minus the home equity you own at the end (appreciated value − remaining loan balance).
- Renting: all rent paid (growing each year), minus what you would have earned by investing the down payment and the monthly savings vs. the mortgage at the investment return rate.
- Break-even is the first year where buying's effective cost drops below renting's.
- Simplified model: it ignores transfer fees, taxes, maintenance and rent deposit. Use it to compare scenarios, not as financial advice.
Frequently Asked Questions
How is the break-even year calculated?
Month by month, we compare the effective cost of buying (down payment + mortgage payments − home equity you own) against renting (rent paid − investment returns on the down payment and monthly savings). The break-even year is the first year buying becomes cheaper.
What does "effective cost" mean here?
Not just cash spent: buying builds equity as the property appreciates and the loan balance shrinks, while renting lets you invest the down payment elsewhere. Effective cost subtracts that wealth from what you paid.
What is not included?
Transfer fees, taxes, maintenance and rent deposits are ignored to keep the comparison simple. Treat the result as a scenario comparison, not financial advice.