Buy vs Rent Calculator
South African buy vs rent calculator. Compare total cost of buying (bond, transfer duty, maintenance) vs renting (rent escalation, invested deposit) over 5–20 years with NPV crossover analysis.
Quick Calculator Get a fast estimate
R
R
What you would pay to rent a comparable property.
%
Current prime rate is around 11.75%. Add 1-3% for your rate.
years
How many years you plan to stay in the property.
Buy is Better (est.)
R 2 116 363
Monthly Bond Payment
R 14 630
Monthly Rent
R 12 000
Monthly Difference
R 2 630
Deposit Required (10%)
R 150 000
Transfer Duty + Costs
R 34 500
Property Value in 10 years (est.)
R 2 686 272
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Buy vs Rent Decision Framework
The key question is: does the equity you build through buying outweigh the investment return you could earn by investing your deposit while renting? Both paths have significant costs — transfer duty, bond interest, and agent fees for buying; rising rent for renting.
In South Africa's high-interest-rate environment (bond rates ~11–14%), monthly bond payments are often 30–50% higher than equivalent rent. The break-even typically occurs around year 5–8, depending on location and market conditions.
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Extended Calculator More options, charts, and scenario comparison
R
%
%
years
Monthly Bond Payment
R 14 630
Deposit (10%)
-R 150 000
Transfer Duty
-R 12 000
Bond Registration (est.)
-R 15 000
Conveyancing (est.)
-R 15 000
Total Upfront Cost
R 192 000
Transfer Duty Table (2024)
| Property Value | Transfer Duty Rate |
|---|---|
| R0 – R1,100,000 | 0% (exempt) |
| R1,100,001 – R1,512,500 | 3% on excess above R1.1m |
| R1,512,501 – R2,117,500 | R12,375 + 6% |
| R2,117,501 – R2,722,500 | R48,675 + 8% |
| R2,722,501 – R12,100,000 | R97,675 + 11% |
| Above R12,100,000 | R1,128,600 + 13% |
Total Acquisition Cost Example
R1,800,000 property purchase:
Transfer Duty: R12,375 + (R1,800,000 − R1,512,500) × 6% = R29,625
Bond Registration: ~R18,000
Conveyancing: ~R18,000
Total Costs: ~R65,625 (3.6% of price)
Plus deposit (10%): R180,000
Total Upfront: ~R245,625
Monthly bond (20yr, 11.75%):
Loan = R1,620,000
Monthly = ~R17,400
Need full precision?
Professional Calculator Complete parameters, sensitivity analysis, and detailed breakdown
Property (Buy)
R
%
%
years
%
%
%
Renting Alternative
R
%
%
R
Analysis Parameters
years
%
Buying is Better (NPV Analysis)
R 743 556 advantage
Monthly Bond Payment
R 17 556
Total Upfront (deposit + costs)
R 236 625
Property Value at Year 15
R 4 313 805
Sale Proceeds (net of costs)
R 4 011 839
Equity at Year 15
R 3 520 071
Rent Portfolio at Year 15
R 1 016 137
Year-by-Year Comparison
| Year | Property Val | Equity (Buy) | Portfolio (Rent) | Buy NPV | Rent NPV |
|---|---|---|---|---|---|
| 1 | R 1 908 000 | R 309 454 | R 256 531 | R -456 692 | R -341 111 |
| 3 | R 2 143 829 | R 596 503 | R 356 808 | R -853 169 | R -657 822 |
| 5 | R 2 408 806 | R 926 196 | R 429 227 | R -1 198 235 | R -967 463 |
| 7 | R 2 706 534 | R 1 305 690 | R 509 965 | R -1 499 037 | R -1 270 343 |
| 10 | R 3 223 526 | R 1 987 440 | R 660 419 | R -1 880 419 | R -1 712 576 |
| 15 | R 4 313 805 | R 3 520 071 | R 1 016 137 | R -1 355 474 | R -2 099 030 |
Frequently Asked Questions
Depends on your time horizon and the price-to-rent ratio. Cape Town (high ratio) often favours renting for horizons under 7 years. Johannesburg and Pretoria (lower ratios) may break even sooner. High interest rates currently favour renting in the short term.
Transfer duty, bond registration (~1–1.5%), conveyancing (~1–1.5%), plus your deposit (10–20%). Total acquisition costs add 8–15% to the purchase price. Transfer duty is 0% below R1.1m.
0% below R1.1m; 3% on R1.1m–R1.5125m; 6% on R1.5125m–R2.1175m; 8% on R2.1175m–R2.7225m; 11% on R2.7225m–R12.1m; 13% above. New builds pay VAT (15%) instead.
Generally 5–8 years minimum to recoup transfer duty, bond registration fees, and selling costs (agent commission ~7–8% plus VAT). The crossover depends on property growth vs investment return alternatives.
Only if the property is used to generate rental income. For a primary residence, bond interest is not deductible. Rental property owners can deduct bond interest, rates, insurance, maintenance, and agent fees against rental income.