Rent or buy: what does it look like in 10 years?
Over 10 years, buying or renting can come out ahead, and the answer depends mostly on your deposit, the mortgage rate and how fast house prices rise. In the simple example below, the owner ends up about $163,000 ahead, but small changes to the assumptions can shrink or erase that gap.
Where things stand in October 2026
- The Reserve Bank reports that advertised mortgage rates at the end of August 2026 were 6.26% floating, 5.48% for one year and 5.89% for two years.
- REINZ put the national median house price at $750,000 in August 2026, down 1.3% on a year earlier.
- The Reserve Bank's loan-to-value rules still say banks can lend no more than 25% of new owner-occupier loans at above 80% of a home's value. That is why many banks want a 20% deposit.
- The First Home Grant has ended. The government's first home page now lists it under help that is no longer available.
- The First Home Loan lets some buyers purchase with a 5% deposit. You can use your KiwiSaver withdrawal toward it, but you must have been in KiwiSaver for at least 3 years.
- The bright-line test is 2 years for property sold on or after 1 July 2024. It generally does not apply to your main home if you meet the Inland Revenue conditions.
Rates and insurance are real ongoing costs for owners, but we did not find an official typical figure, so the example uses a stated assumption instead.
A worked example
This is an illustration with stated assumptions, not a prediction.
- House price $750,000, 20% deposit ($150,000), loan $600,000 at 5.5% over 30 years. Repayments are about $3,407 a month.
- Rates, insurance and maintenance: $7,000 a year, rising 3% a year. This is our assumption, not a sourced figure.
- House price growth: 3% a year. Selling costs are ignored.
- Renting an equivalent home: $650 a week, rising 3% a year. This is our assumption, not a national figure.
- The renter invests the $150,000 deposit at 4% a year, plus every dollar saved by not paying the owner's higher yearly costs.
| After 10 years | Owner | Renter |
|---|---|---|
| Year 1 cash out | $47,881 | $33,800 |
| House value | $1,007,937 | None |
| Mortgage left | $495,246 | None |
| Investments | None | $350,006 |
| Net position | $512,691 | $350,006 |
The owner wins here because the house gains value and each repayment cuts the debt. The renter wins if prices stay flat, if mortgage rates are higher, or if investments beat 4%.
What changes the answer
- Growth rate. At 1% a year the owner's lead shrinks a lot, and at 5% it grows. Nobody can know the next 10 years.
- Mortgage rate. Each extra percentage point adds thousands to yearly repayments. Two year rates are 5.89% today, above the 5.5% we used.
- Rent gap. If a comparable rental costs far less than owning, the renter has more to invest each year.
- Time in the home. Selling within a few years makes buying costs and selling costs hurt more.
- Discipline. The renter result only works if the savings really are invested and left alone.
The catch
This comparison is tidy, and real life is not. House prices can fall, as the 1.3% yearly drop shows. Rates change when your fixed term ends. Selling costs, repairs and a job move can cut into an owner's gain. Renters face rent rises and the chance of being asked to leave. The renter result also assumes steady saving, and many people find that harder than paying a mortgage.
Do this next
- Write down your deposit, your KiwiSaver balance and when you joined KiwiSaver.
- Check the rent for a home like the one you would buy at the Tenancy Services market rent tool.
- Ask a bank or broker what rate and deposit they would want from you.
- Add rates, insurance and maintenance to your budget using real quotes.
- Run your own numbers, including a lower growth rate and a higher mortgage rate.
This is general information, not financial advice. Try your own figures in our rent or buy planner.
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Last reviewed 3 October 2026. Written by The Daily Kiwi from the official pages listed above.