Buy or rent: which is more profitable for 30 years in a housing crisis

Buying or renting a home is one of the key financial choices in life. In conditions of increasing housing crisis in Greece, the comparison between “rent and mortgage” cannot be reduced only to the size of the monthly payment.

The question is what remains after 30 years in terms of net worth.

Structural housing shortage

After the 2008 crisis, construction activity in the country practically froze. It is estimated that there is a shortage of approximately 180,000 housing properties. Prices have recovered and exceeded pre-crisis levels, but household incomes have not shown comparable growth.

According to the former deputy manager Bank of Greece Theodoros Mitrakos, housing costs in Greece reach 35.5% disposable income vs. 19.2% in the eurozone. Almost 30% of households spend more than 40% of their income on housing.

Comparison model for 30 years

Company research ReDataset compares two households with the same starting capital – about 82,000 euros.

First scenario: buying a home worth 300,000 euros with a down payment of 60,000 euros and a 30-year mortgage at 3.5%.

Second scenario: rent and investment of initial capital, as well as up to 200 euros monthly, provided that rent is cheaper than the full cost of ownership.

The assumptions are moderate: property value growth of 1% per year, rental growth of 1.5%, return on investment of 3.5%.

Costs taken into account

Purchase – monthly billing

Rent – rate range

Total payments over 30 years

Net worth after 30 years

Break even

In areas with high rental pressure, such as Glyfada or Kifissia, buying begins to outperform renting after only 6–8 years. In Patras or Thessaloniki – via 13–14 years old.

The key indicator is rent-to-price ratio: The higher the rental to purchase price ratio, the faster ownership becomes more profitable.

Financial results for 30 years

Over 30 years, the owner pays about 562.000 euros (including fee, interest and expenses). Tenant – from 279.000 to 585.000 euros depending on the region.

The difference is that the owner retains the asset. At the end of the period, the owner’s net worth is estimated at 230.000–240.000 euros. For a tenant, the result highly depends on the investment discipline and region of residence; in some cases the net position may be negative.

Social aspect

The issue is not only economic. Housing is at the same time investment asset And social good. The rise in prices after 2017 was not accompanied by an even increase in wages, which increased pressure on the middle class and young buyers.

Renting gives you flexibility and mobility. Ownership provides stability and capital accumulation over a long-term horizon.

The main conclusion of the study: you need to compare not “payment today”, but “net cost in 30 years”. There is no universal answer. The decision depends on the region, time horizon, income stability and financial risk appetite.

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