Buying and Renting a House: Owning or buying a house is the dream of anyone entering their 30s. After getting a job and gradually buying a car, most middle-class youth are tense about saving money to buy a house. However, compared to the past, many people do not build their lives in the place where they were born and raised. However, it is a great desire of many to have a house by the time they plan their retirement.
The biggest doubt that such people always have is whether to rent or buy a house. For a middle-class and upper-middle-class family, when they spend money on rent from their salary, a loan is the only way to buy a house. Let’s compare this
For example, let’s calculate the loan amount for a house worth one crore rupees for 20 years. In 2025, to buy a very good house or flat with two or three rooms in the middle of cities like Kochi and Thiruvananthapuram, you can calculate the amount of about one crore rupees. For these, you will have to pay about 20 percent upfront. Suppose you can take the remaining Rs 80 lakh as a home loan.
The monthly EMI for a home loan with an average interest rate of 8.5% for 20 years is about Rs 69,426. That is, in total, the buyer will have to pay about Rs 86.6 lakh as interest only. When calculated in this way, Rs 20 lakh as a down payment, Rs 80 lakh as a principal loan, and Rs 86.6 lakh as interest, the total cost is Rs 1.86 crore.
At the same time, your location is very important here. If we assume that the price increases by 6% per year depending on the value of your property and land, the value of this house will increase to about Rs 3.21 crore in 20 years. In short, even if you spend Rs 1.86 crore, you can create an asset of Rs 3.21 crore.
Now let’s look at the figures for renting a house or flat. Let’s say you are renting a house worth Rs 1 crore in the same city and you are spending around Rs 40,000 per month on rent. With a rent increase of around 10% per year, the rent is likely to reach Rs 2.65 lakh in 20 years. In total, you are likely to spend around Rs 2.75 crore on rented houses in 20 years. But keep in mind that you are not building an asset along with this.
In the long run, owning a house is more beneficial for a middle-class and upper-middle-class family. This is because the asset will eventually be in hand. Even if it costs the same to rent a house with the same luxury over the same period, it will never matter later. However, it all depends on your income, lifestyle, location and your other plans.
Also Read: Top 5 Vitamins for Strong and Healthy Hair
Share
Janhvi Kapoor Fitness and Diet Secrets for Toned Body
Spider-Man Turns Hero on Mumbai’s Flooded Streets: Viral Video
