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How to use the Rent vs Buy calculator
Rent vs Buy settles the argument with numbers instead of feelings. It runs two futures side by side: you buy the place and build equity, or you rent it and invest every rand buying would have cost you. After your chosen horizon, it tells you which left you wealthier.
The calculator compares net wealth, not monthly cost, which is the comparison that actually matters. The buyer ends with a house worth something after selling costs, less whatever is left on the bond. The renter ends with an investment pot: the deposit, the upfront costs, and every month the bond plus rates ran more than the rent, all invested and compounded.
Two assumptions drive the answer more than any others: how fast the property appreciates, and what the renter earns on their investments. Be honest with both. A buyer who pencils in 10% house growth while giving the renter 4% returns is not running a fair race.
What you'll need
- For buying: the price, deposit, bond rate and term, monthly rates and levies, a maintenance allowance, an appreciation rate, and the selling costs you would pay one day.
- For renting: the monthly rent, the annual escalation, and the return you would earn investing the difference.
- The horizon, in years, to run the comparison over.
How to use it
Fill in the buy side first. Leave upfront costs on Auto (SA) to have the transfer duty and attorney fees estimated, or switch to Manual. The maintenance, appreciation and selling-cost percentages are where people fool themselves, so set them where you genuinely believe them.
Then the rent side. The investment return is the renter's engine: it is what they earn on the deposit and the monthly saving. Set the horizon to how long you realistically expect to stay. A short horizon almost always favours renting; a long one almost always favours buying.
Reading your result
The price-to-rent gauge at the top is the quick read: price divided by a year's rent. Below 16 leans buy, 16 to 21 is roughly even, above 21 leans rent, on the bands the Global Property Guide reports for South Africa.
The verdict card calls the winner at your horizon and shows the break-even point, the year buying overtakes renting. The wealth chart traces both paths; the gap chart shows buying minus renting; the outflow chart shows what each costs you month to month.
A worked example
An R1,800,000 flat, 10% down, bonded at 10.5% over 20 years, against renting the same place for R13,000 a month. Property growing 5% a year, investments returning 10%, rent escalating 8%, over a 20-year horizon.
The price-to-rent ratio is 11.5, which leans buy. Buying breaks even after about 10.2 years and ends the 20 years with R4,489,380 in equity, against the renter's R1,898,360 pot. Buying wins here, but only past the break-even. Sell in year 8 and renting was ahead.
What it does not do
It cannot know your real investment returns or what your suburb will do, and small changes to those assumptions move the answer a lot. Treat it as a structured way to test your own beliefs, not a forecast. It is information, not advice to buy, sell or invest.
Settled on buying? The Property Analyser grades a specific deal, and Bank Affordability shows what a bank would lend you. When you are ready, open Rent vs Buy.
Money Cat is an information tool, not financial advice. The rate shown is the SARB prime as at June 2026. The result swings on assumptions only you can set, so confirm them before you rely on the answer.