Rent or buy: how to compare them fairly

What each option costs, what tips the balance, and why how long you plan to stay matters.

Published 12 October 2026

The right question

"Rent is money thrown away" is only half the story. A buyer throws money away too: on interest, taxes and upkeep. The right question is how much you are left with after a number of years, either way.

What you are really comparing

If you buy, you pay the down payment and the purchase costs, then the mortgage payment, upkeep, insurance and property tax. At the end you have a home, less the remaining loan and the cost of selling.

If you rent, you keep the down payment and invest it. In every month when the rent is lower than the owner's cost, you invest the difference too. At the end you have the sum you built up.

The comparison is only fair if both households spend the same each month and the renter really does invest the difference.

An example

A 500,000 lei home, with a 20% down payment and a 30-year loan at 5.9%: the payment is about 2,373 lei. Assume purchase costs of 2%, upkeep of 1% a year, home prices rising 3% a year, rent rising 4% a year and investments returning 6% a year.

If a similar home rents for 2,500 lei, buying comes out ahead from the second year.
If it rents for 1,800 lei, buying only comes out ahead from the ninth year.

The same home, the same interest rate. Only the rent differs.

What tips the balance

How long you stay. The costs of buying and selling take years to recover. If you move within two or three years, renting usually wins.
Rent relative to price. The higher the rent compared with the price, the better buying looks.
The mortgage rate and the return you could realistically earn by investing.
Where prices go, which nobody knows in advance.

What the sums leave out

Stability, the freedom to renovate and the certainty that nobody can ask you to move have a value, even if they do not show up in the figures. So does the freedom to leave easily when you rent. The calculation shows the price of each choice, not the choice.

Change the assumptions to match your situation in the rent or buy calculator and see from which year buying comes out ahead.

What you are really comparing

If you rent, you keep the down payment and invest it. In every month when the rent is lower than the owner's cost, you invest the difference too. At the end you have the sum you built up.

The comparison is only fair if both households spend the same each month and the renter really does invest the difference.

An example

If a similar home rents for 2,500 lei, buying comes out ahead from the second year.

If it rents for 1,800 lei, buying only comes out ahead from the ninth year.

The same home, the same interest rate. Only the rent differs.

What tips the balance

How long you stay. The costs of buying and selling take years to recover. If you move within two or three years, renting usually wins.

Rent relative to price. The higher the rent compared with the price, the better buying looks.

The mortgage rate and the return you could realistically earn by investing.

Where prices go, which nobody knows in advance.

What the sums leave out

Change the assumptions to match your situation in the rent or buy calculator and see from which year buying comes out ahead.