This Spain rent vs buy calculator answers a question every mover in Madrid, Barcelona or Valencia faces: is it smarter to keep renting, or to buy with a Spanish mortgage? It models the full financial picture — the upfront ITP or IVA purchase tax, the mortgage, the annual IBI and community costs, appreciation, and the alternative of investing the money you would have sunk into a home.
How it works
The tool runs two parallel net-worth paths over the years you plan to stay.
Buying. Upfront you pay the deposit plus acquisition costs (ITP or IVA plus notary, registry and agency fees — a percentage you set). The mortgage amortises monthly at your interest rate; each year you also pay the IBI property tax plus community fees, maintenance and insurance. At the horizon the home is sold at the compounded appreciation rate, a selling cost is deducted, and the outstanding mortgage is repaid. What remains is your buyer equity.
Renting. The renter starts by investing the deposit and purchase costs they did not spend. Each month, if owning costs more than rent, the difference is also invested at your assumed return; rent itself grows each year. Their final net worth is that invested pot.
The verdict is simply buyer equity − renter net worth: positive means buying wins, negative means renting wins.
Example
Buy a EUR 280,000 flat with a EUR 56,000 deposit, 10% acquisition costs, a 3.5% mortgage over 25 years, staying 10 years, against EUR 1,100 rent. With 3% appreciation and a 5% investment return, the tool shows whether the buyer’s equity at sale beats the renter’s invested savings — and exactly which costs (the EUR 28,000 of ITP/fees, the mortgage interest, the IBI) drove the gap.
Notes
This is a simplified model. It ignores capital gains tax on the home sale, tax on the renter’s investment gains, and assumes you sell at the horizon. Remember that a resale home pays ITP (about 6–10% by region) while a new-build pays 10% IVA plus 1.5% AJD — set the acquisition rate accordingly. Use it to compare scenarios, not as financial advice.