Rent vs. Buy Calculator in Madrid (2026)
Is it better to rent or buy a home in Madrid? See the break-even point and total cost comparison over your chosen time horizon.
Property Price
336.000 €
70m² · 4800 €/m²
Down Payment
67.200 €
20% of purchase price
Monthly Mortgage
1275 €
3.0% rate · 25yr term
Monthly Rent
1300 €
City centre
📅 Break-even point: Year 3
Buying becomes cheaper than renting after 3 years in Madrid, once property appreciation and equity are factored in.
After 10 years: Buying saves approximately 170.622 € vs renting.
Cumulative Cost Comparison — Madrid
Net costs after accounting for property appreciation and investment returns on down payment.
| Year | Net Buy Cost | Net Rent Cost | Property Value | Verdict |
|---|---|---|---|---|
| 1 | 27.716 € | 8544 € | 354.480 € | 🔴 Rent |
| 2 | 20.592 € | 17.062 € | 373.976 € | 🔴 Rent |
| 3 | 12.166 € | 25.534 € | 394.545 € | 🟢 Buy |
| 4 | 2372 € | 33.936 € | 416.245 € | 🟢 Buy |
| 5 | -8859 € | 42.245 € | 439.139 € | 🟢 Buy |
| 6 | -21.601 € | 50.434 € | 463.291 € | 🟢 Buy |
| 7 | -35.930 € | 58.472 € | 488.772 € | 🟢 Buy |
| 8 | -51.928 € | 66.327 € | 515.655 € | 🟢 Buy |
| 9 | -69.680 € | 73.965 € | 544.016 € | 🟢 Buy |
| 10 | -89.274 € | 81.348 € | 573.937 € | 🟢 Buy |
Monthly Cost Breakdown
Buying
Mortgage: 1275 €
Maintenance: 336 €
Property Tax: 50 €
Total Monthly: 1661 €
Does not include down payment of 67.200 €
Renting
Monthly Rent: 1300 €
Annual Increase: +3% assumed
Opportunity Gain: Down payment invested at 7%/yr
Total Monthly: 1300 €
Rent increases 3%/yr in projection
Can you afford to buy in Madrid?
Monthly net income: 4267 €
Monthly mortgage: 1275 €
Mortgage-to-income ratio: 29.9%
🟡 Manageable but tight
Down payment savings needed: 100.800 €
At 20% savings rate, years to save: 9.8 years
Notes & Assumptions
This calculator uses the following assumptions for Madrid in 2026: property price 4800 €/m² × 70m², mortgage rate 3.0% over 25 years, 20% down payment, transaction costs 10.0%, annual maintenance 1.2%, property appreciation 5.5%/yr, rent inflation 3%/yr, opportunity cost of capital 7%/yr. Cheapest mortgage in Eurozone ~2.98% (Jul 2025). ITP 6% in Madrid. Spain prices +12.8% YoY Q2 2025.
Same calculator, other cities
Frequently Asked Questions
Is it better to rent or buy in Madrid in 2026?
Based on 2026 data, buying a home in Madrid typically becomes financially advantageous after 3 years, once property appreciation and equity are factored in. With a mortgage rate of 3.0% and estimated annual appreciation of 5.5%, buying makes sense for long-term residents.
How much do you need to earn to buy in Madrid?
A typical 70m² apartment in Madrid costs approximately 336.000 € in 2026. With a 20% down payment of 67.200 €, the monthly mortgage is 1275 €. Financial advisors recommend keeping mortgage payments below 28–35% of net monthly income, which implies a gross salary of at least 50.987 € per year to comfortably afford this purchase in Madrid.
What is the price-to-rent ratio in Madrid?
The price-to-rent ratio in Madrid is approximately 20x in 2026 — meaning it takes 20 years of rent to equal the purchase price. A ratio above 20 generally favours renting; below 15 generally favours buying. Madrid's ratio of 20 suggests the decision depends heavily on your time horizon and expected appreciation.
How this calculator works
This calculator compares the total cost of renting versus buying over a configurable time horizon. It includes mortgage payments, transaction costs, maintenance, property appreciation, rent inflation, and the opportunity cost of tying up capital in a down payment.
What's included
- Mortgage principal and interest payments
- Transaction costs (stamp duty, notary, etc.)
- Annual maintenance and property tax
- Property appreciation and rent inflation
- Opportunity cost of capital (7% default)
What's not included
- Renovation or major repair costs
- Home insurance premiums
- Tax relief on mortgage interest (varies by country)
- Emotional or lifestyle value of ownership
Data sources: Central bank mortgage rate data, local property price indices, Numbeo rental averages, and official transaction cost schedules. Updated for 2026.