How does a rent vs buy comparison work?

Buying builds equity but ties up your deposit and adds stamp duty, maintenance, land rates and service charge. Renting keeps your deposit free to invest. The tool projects both paths over 10 years and compares your net wealth — home equity if you buy, versus your grown investment portfolio if you rent.

What costs does buying include in Kenya?

Upfront it adds 4% stamp duty (in urban areas) plus legal and valuation fees of roughly 2–3%. Each year it adds land rates, service charge for apartments, maintenance and insurance, on top of the mortgage instalments.

Why does the investment return matter for renting?

If you rent, the money you did not spend on a deposit and ownership costs can be invested — for example in a money-market fund or T-bills. The comparison credits the renter with that portfolio's growth, so a higher assumed return makes renting more attractive, all else equal.

Is buying always better long term in Kenya?

Not necessarily. Kenyan mortgage rates are high, often 13% or more, so interest and ownership costs can outweigh equity gains over 10 years, especially if money-market returns are strong. The result is sensitive to your rate, appreciation and return assumptions — change them to test.

Does this calculator store my data?

No. All figures are computed locally in your browser and nothing is uploaded, so your details stay private.

Kenya Rent vs Buy Calculator

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This Kenya rent vs buy calculator projects ten years of both choices and tells you which leaves you wealthier, using Kenyan mortgage rates, stamp duty and ownership costs.

How it works

The tool simulates month by month and compares net wealth at year 10.

Buying: you pay the deposit, stamp duty and fees upfront, then a fixed mortgage instalment plus yearly land rates, service charge, maintenance and insurance. The property appreciates each year, and you build equity as the loan amortises. Your buyer net worth is home value − remaining loan.

Renting: you pay rent (growing each year) and invest the money you would otherwise have spent on the deposit and on any month where ownership costs exceed rent. That invested pot grows at your assumed return. Your renter net worth is the portfolio value at year 10.

The cheaper path is the one that leaves you with more net wealth after ten years.

Example

A KES 9,000,000 apartment with a KES 2,700,000 deposit at 13% over 20 years, versus renting an equivalent home for KES 45,000/month — with 5% appreciation, 5% rent growth and a 10% investment return — can swing either way. High mortgage interest favours renting; strong appreciation favours buying. Adjust the inputs to see the tipping point.

Notes

The result is very sensitive to the appreciation and investment-return assumptions — test a range, not a single guess.
This is a financial model only; it ignores lifestyle factors like security of tenure and freedom to renovate.
Kenyan money-market funds have offered strong nominal returns recently — set the investment-return input to your realistic after-tax rate.