Renting vs Buying a Home

Renting

People spend more on their own home, so cost of living increases
If you have a small kid, live in rented home, so you don't care more for walls, etc
Unrecoverable cost of owning vs buying
- Property Taxes, Maintenance costs, cost of capital
Take the value of the home that you are considering multiply by 5% and divide by 12
Never buy a home, don't buy a land too
- Land is not that scarce, world has too much land (Africa is 9 times of India) because house depreciates in value, but land appreciates in value land is a commodity, house is a consumer good

From Yeh Flat Overpriced Hai Ya Nahi? (The Vipul Talks), a Hinglish video; yield figures are approximate 2026 data.

Circle rate vs market price: the circle rate is the government rate (state registration site) and the market rate comes from MagicBricks, 99acres or local dealers. A market price well above circle rate means strong demand and one near or below it is a warning. Stamp duty is charged on the higher of the two
Rental yield = annual rent / property value x 100 (₹1 crore at ₹30,000 a month is 3.6%). India's gross average is about 5% (Hyderabad above 5%, Pune about 4%, Mumbai and Bangalore 3.5-4%, Delhi NCR sometimes below 3%); net yield is at least a percentage point lower after maintenance, property tax, vacancy and brokerage
Price-to-rent ratio = price / annual rent (₹1 crore at ₹25,000 a month is about 33). Below 20, buying makes financial sense; above 25, renting is better. Most metros are well above 25, and Mumbai is about 40-45
Appreciation potential: metros have historically returned 8-12% a year, not guaranteed. Check infrastructure (metro, highway, airport), employment (new offices), the supply pipeline (heavy launches cap prices) and the micro-market's 5-year trend
Total return and liquidity: total return is yield plus appreciation (4% + 8% = 12%) against FDs at 6.5-7% and equity MFs historically at 12-15%. Selling takes 2-4 months and buy-side costs are about 7-9%, so property needs a 7-10 year horizon