Should you rent or buy a home in South Africa? (2026/27)
Figures for the 2026/27 tax year. Prime rate checked 9 October 2026; tax tables and fees checked 30 September 2026. By AfroTech.
"Rent is dead money" is only half the story. Buying has big costs of its own: transfer and bond costs up front, interest, maintenance and rates, and agent's commission when you sell. Here's how the two compare over time.
The comparison
We compare two households with the same income. One buys a R 1 500 000 home with a R 150 000 deposit and a bond at prime (10,75%). The other rents a similar home and invests the cash the buyer put down. Each month, whoever's housing costs less invests the difference.
| Monthly rent | After 5 years | After 10 years | After 20 years | Buying pulls ahead after |
|---|---|---|---|---|
| R 8 000 | Rent +R 295 749 | Rent +R 387 794 | Rent +R 134 386 | Not within 20 years |
| R 10 000 | Rent +R 128 920 | Buy +R 92 148 | Buy +R 1 861 313 | 9 years |
| R 12 000 | Buy +R 37 909 | Buy +R 572 090 | Buy +R 3 857 013 | 5 years |
| R 15 000 | Buy +R 288 153 | Buy +R 1 292 003 | Buy +R 6 850 562 | 3 years |
Assumptions: home value grows 5% a year, rent rises 6% a year, investments earn 9% a year before tax, owner's costs 1,5% of value a year, selling costs 5%.
Why renting wins at first
On day one the buyer has spent about R 95 567 on transfer and bond costs on top of the deposit, money the renter keeps invested. Selling also costs around 5% of the price. It takes several years of rising value and repaid bond to recover those costs, which is why buying a home you'll sell within a few years rarely pays.
What tips the balance
- House price growth. At 3% a year instead of 5%, renting at R 12 000 still loses, but buying's lead after 20 years shrinks to R 2 913 648.
- Rent compared with the price. The cheaper rent is relative to the home's price, the longer renting stays ahead.
- Discipline. Renting only wins if the difference is actually invested, every month. A bond forces you to build equity.
- How long you'll stay. The longer you stay, the better buying looks.
Try it with your own numbers. The ZARWise calculator uses the same figures as this page.
Compare renting and buying with your numbers