Is buying property really worth it, or are you better off renting in the long term? Grundheim’s rent-vs.-buy calculator compares both scenarios over your personal time horizon and takes all relevant factors into account: mortgage interest rates, return on equity, ancillary costs, imputed rental value, tax effect, property appreciation and inflation trends. You receive not only the break-even time (from when buying pays off), but also the expected increase in wealth under both options. Ideal for first-time buyers in Zürich, Zug or any other Swiss city who are deciding between renting and owning.
The most important variables are the purchase price relative to the annual rent (price-to-rent ratio), mortgage interest rates, your return on equity from an alternative investment, the holding period, the expected appreciation of the property and the ancillary costs. In urban areas such as Zürich, Zug or Genf, the price-to-rent ratio is 30–40 – here, buying often only pays off after a holding period of 10–15 years.
The calculator simulates both scenarios year by year: when buying, there is initial equity, incidental purchase costs (notary, property transfer tax) and ongoing mortgage interest plus ancillary costs; when renting, the capital remains invested and generates a return. The break-even is the point at which the cumulative wealth advantage of buying exceeds the costs.