Pay Rent or EMI-Which Decision is Better for You?

Buying a home is synonymous with settling down, but it involves significant financial outlays. There is an ongoing debate about whether it is preferable to pay rent or to buy House on EMI and become the owner. To help you clear up any confusion and come to a decision, we have thoroughly discussed and analyzed both options below.

Most people believe that renting is cheaper than buying a home. For instance, consider the topic of buying vs renting a house in Mumbai. If you do not intend to stay in this city for an extended period, renting flat in Mumbai is more cost-effective than buying home in MMR.So, it all depends on the person’s needs and circumstances.

Advantages of Home Loan EMI Payments over Housing Rentals:


When you own your dream home, you feel a sense of accomplishment. You have no restrictions, so you feel secure and accomplished. Nothing can compare to the peace of mind it brings.

When you pay your home loan EMIs, you are accumulating assets. Also, the property in which you invest can become a source of income in the long run by renting it out or reselling it at a higher market value.

Predictable monthly expenses

If you buy house on EMI, the buyer is fully aware of the monthly payment required. This allows the buyer to appropriately set his monthly spending limit. 

Tax benefits

As the government wants every citizen to own a home, it offers tax deduction benefits under sections 24B, 80C, 80EE, and 80EA of the income tax act to help people who buy a house.

Advantages of Renting instead of Buying a Home:

More freedom

Renters have more freedom because they can live almost anywhere, whereas homeowners are limited to a specific area. Depending on their budget, they can select more affordable options. It gives you the freedom to move across the country because short living a lease is much quicker than selling a house, which is one of the key advantages.

No repair and maintenance cost

When you rent a property, the landlord is responsible for all maintenance, repairs, and improvements. If there are any malfunctions, it is the responsibility of the landlord to fix them.

Save money on utilities

Some homes or apartments include utilities. Most probably, the only bills you have to pay are for gas and electricity.

Points to consider before renting flat in Mumbai

  • Do a thorough investigation of the area.
  • Conduct a thorough physical examination.
  • Parking, security, and safety facilities should always be checked.
  • Don’t sign the rental agreement before reading the terms of the deal.

The following factors influence the decision to rent or buy House on EMI:

Let’s understand buying vs renting a house in Mumbai with the example below.

For example, if a buyer wishes to remain in Mumbai and is confident of his job’s stability and salary increase shortly, he/she should consider buying a home in MMR with some monthly EMI; otherwise, renting flat in Mumbai is a better option.

Consider your financial backup and determine whether the EMI exceeds 40% of your monthly income. If so, renting is a better option than buying. Investigate how to buy a flat on EMI so that you can select from a variety of options and decide.

Over to you, whether you wish to pay rent or an EMI. Several factors, such as stay period, job security, income increment, financial backup, and others, play a vital role in decision-making.

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