Is renting really a waste? CA’s viral math challenges India’s age-old belief

In India, the urge to own a home remains deeply rooted in society. It is often described as a symbol of financial security and personal success. Meanwhile, renting is frequently dismissed as mere money lost, without long-term benefits.

But as economic realities shift and people navigate changing lifestyles, experts and homeowners alike are beginning to challenge this conventional wisdom. What does it really cost to own a home? Is renting truly a waste, or could it sometimes offer more financial sense and flexibility? The conversation has become more nuanced, inviting a closer examination beyond the usual narratives. The hidden financial burden of home loansTaking a home loan is often viewed as a step toward building an asset, but the long-term costs tell a different story.

High interest payments can nearly double the initial price of a property, turning monthly EMIs into a heavy commitment.

Chartered Accountant Nitin Kaushik explains, “Rent isn’t always waste. It buys you flexibility + liquidity. A home loan isn’t always an investment. It’s leverage + liability. Owning vs renting isn’t about emotions. It’s about math + timing.”Why timing and financial stability matterKaushik warns against rushing into homeownership without financial preparation.

Large down payments can drain savings, while EMIs often consume more than 40% of monthly income.“Buying too early = financial handcuffs. You’re tied to a loan for 15-20 years. You can’t move cities for better jobs without extra cost. Your biggest asset becomes your biggest liability,” he notes.He recommends building a 6–12 month emergency fund before buying and ensuring EMIs remain below 30% of income.Renting: More than just a temporary solutionKaushik also highlights the benefits of renting, pointing out that it reduces financial and lifestyle constraints.

“Sometimes renting = financial freedom. No property tax, no repair headaches, no fixed location. Your money stays liquid, ready for better investment opportunities.” Different voices, different experiencesThe discussion also reflects varied personal experiences. One netizen shared, “Only then realized the value of being in my own home,” after spending two decades renting.Others raised concerns about rising rents, which Kaushik addressed with numbers, as quoted by the Economic Times: “Average rental yields in Indian cities stand at just 3.5–5% annually, while property appreciation averages 5–6.5%.

Over 20 years, a ₹1 crore flat may grow to about ₹3.2 crore. However, factoring in a 20-year loan means paying nearly ₹73 lakh in interest.”He added that equities, with returns of “11–13% plus dividends,” often outperform real estate in the long run.Disclaimer: This article is based on posts shared on X by Chartered Accountant Nitin Kaushik and views expressed by individual users. The Times of India does not endorse or take responsibility for these opinions or financial suggestions. Readers are advised to exercise discretion and seek professional guidance before making any financial decisions.Thumb image: Canva (for representative purposes only)