Rent vs Buy Calculator — Cyprus
Renting is not "money down the drain", and buying is not automatically cheaper — it depends almost entirely on how long you stay. This calculator compares the cumulative cost of both, year by year, and shows the year buying overtakes renting.
Inputs
The 5% rate applies to the first 130 m² of buildable area up to €350,000, provided the transaction does not exceed €475,000 and 190 m² of buildable area. Standard VAT applies to the rest.
Market rent for a property you would otherwise rent
Cyprus rents have run ahead of inflation since 2018
0% for a cash purchase
Assumption, not a forecast — try 0% as a stress test
Insurance, communal charges, repairs
1–20 years — the horizon everything is compared over
Verdict
Renting is cheaper over 7 years
Over this horizon buying costs about €28,231 more than renting, after the deposit, taxes, interest, maintenance, the loan capital you repay and the assumed change in value.
Buying overtakes renting in year 9 — after you plan to move on.
Total cost of buying
€138,571
net of capital repaid and value change
Total cost of renting
€110,339
rent paid, compounding each year
Difference
€28,231
in favour of renting
Cash needed on day one
€149,500
deposit + VAT or transfer fees + legal
Monthly mortgage
€1,167
capital and interest
Break-even year
9
— after you plan to move on.
LINE CHART
Cumulative cost of buying vs renting
Year 0 is completion day: the deposit, VAT or transfer fees and legal costs are already paid, which is why buying starts far above renting. Where the buying line drops below the renting line, buying has cost less in total.
TABLE
Year by year
| Year | Buying (cumulative) | Renting (cumulative) | Gap |
|---|---|---|---|
| 1 | €149,645 | €14,400 | renting ahead by €135,245 |
| 2 | €149,255 | €29,232 | renting ahead by €120,023 |
| 3 | €148,310 | €44,509 | renting ahead by €103,801 |
| 4 | €146,791 | €60,244 | renting ahead by €86,546 |
| 5 | €144,676 | €76,452 | renting ahead by €68,224 |
| 6 | €141,943 | €93,145 | renting ahead by €48,798 |
| 7 | €138,571 | €110,339 | renting ahead by €28,231 |
The "total cost of buying" is a NET figure. Each year it adds the mortgage payments and running costs, then deducts the loan capital repaid — which becomes your equity, not an expense — and the assumed rise in value. On a long horizon it can turn negative: that means the property has, on these assumptions, given back more than it took.
Not included: the return you could have earned on the deposit if it stayed invested, selling costs and capital gains tax on exit, and rental income. Value growth is an assumption and is unrealised until you sell.
New builds are costed at the standard 19% VAT. A qualifying primary residence can pay 5% VAT on the first 130 m² (and up to €350,000 of value), which materially lowers the cash needed on day one — ask us whether a specific property qualifies.
How the comparison works
- The buying side starts with the cash needed on day one: deposit, VAT on a new build or transfer fees with the 50% exemption on a resale (tiered 3% to €85,000, 5% to €170,000, 8% above), and legal costs. Each following year adds twelve mortgage payments and the running costs.
- Two amounts are then deducted, because they are not expense: the loan capital repaid during the year — worked out month by month, since the interest share falls as the balance does — and the assumed rise in the property's value for that year.
- The renting side is simple: twelve rents a year, with the annual increase compounding. Rent rising 3% a year is 34% higher by year ten.
- The break-even year is always searched over a 20-year horizon, even if you plan to stay less — so you can see how far away it is, not just whether you reach it.
How to read the result
- The "total cost of buying" is a net figure: it can fall from year to year and eventually turn negative, once capital repaid and value growth outweigh interest and costs. That is not cash in your pocket — it is wealth locked in the property.
- The appreciation assumption is the most powerful lever in the model. Set it to 0% and see what is left: that is the real cost of housing without assuming the market rises.
- Not modelled: the return the deposit could have earned elsewhere, selling costs, capital gains tax on exit, or the 0.4% Central Agency levy on a sale. The tool compares the cost of housing, not investment returns.
- Prices, rents and rates are your own assumptions. Establishing the market value of a specific property needs a valuation by a registered valuer.