Renting or buying a new build: how to decide

There is no clear-cut answer: buying a new build makes sense when you know you will stay in the area for several years and have a stable income and a financial reserve. Renting is the better option if you need flexibility or are not yet sure where and how you want to live. It is best to base your decision on your own calculation, not on a general rule.

What makes up the costs of buying

The price of the flat or house is only the beginning. When buying, allow for your own funds for the down payment, the costs of the loan and of transferring ownership, insurance, and furnishing the home. With a new build there are often further costs for the kitchen, flooring, shading or layout changes that the developer does not include in the base price.

Once you move in, you pay regular costs for building management, the repair fund and utilities. In addition, your mortgage payment may change when the fixed-rate period ends. Check current terms and the possible size of your payment with a mortgage specialist; for a rough idea, use our calculator.

What makes up the costs of renting

When renting, you pay rent, advances for services and usually a deposit. You do not have to worry about major repairs or decisions of the owners' association. On the other hand, rent does not build up any assets, and its amount may change when the contract is extended, depending on what the parties agree.

New builds for rent are mostly offered by investors who bought the flat as an investment. The supply in a particular location may therefore be narrower than for older buildings. Read conditions such as the length of the tenancy, whether pets are allowed, or subletting carefully in the contract.

How to compare the two options fairly

It is not enough to compare the monthly mortgage payment with the rent. Your calculation should include:

• the own funds that would be tied up in the property if you buy, and their alternative use,
• one-off costs of purchase and furnishing,
• the owner's regular costs (repair fund, insurance, management),
• the possible development of interest rate conditions after the fixed-rate period ends,
• the length of time you expect to live in the flat.

The shorter your time horizon, the more the comparison usually favours renting, because the costs of acquiring a property do not have time to pay off. With a longer horizon, buying often pays off instead. Discuss the specific figures for your situation with a mortgage specialist or an independent financial adviser.

What to focus on if you are buying a new build

A new build has advantages over older housing, for example up-to-date technical solutions and a lower likelihood of major repairs in the first years. It also has its own specifics: you often buy from plans, pay in stages, and need to keep track of the completion and handover dates.

• Check the developer, their previous projects and how payments are secured. You will find an overview in the developers section.
• Have the preliminary contract, the reservation agreement and the payment schedule reviewed by a lawyer.
• Find out what is included in the price and what is an extra charge.
• At handover, inspect everything and record any defects in the handover protocol.

The overview of new-build prices helps you get your bearings on pricing, and the project catalogue shows specific flats and houses on offer. You can compare areas in the locations section.

When renting makes sense and when buying does

Renting suits you if:

• you do not know whether you will stay in the city or in your job for a longer period,
• you do not have sufficient own funds or a reserve,
• you want to try out the area first,
• you are waiting for your own new build to be completed and need temporary housing.

Buying suits you if:

• you have a stable income and a reserve even after paying your own funds,
• you plan to live there for several years and want to adapt the flat to your needs,
• you are willing to take on the responsibilities of an owner, including decision-making in the building.

You will find a more detailed step-by-step procedure in the buying guide. If you are looking for a specific flat, you can use the inquiry form.

Frequently asked questions

Is it cheaper to live in a rented home or in one you own?

It depends on the price of the property, the amount of rent, interest rate conditions and the length of time you stay in the flat. Monthly payments alone are not enough; your own funds and one-off costs must be taken into account as well. Try the calculation in the calculator and verify it with an expert.

Can I rent a new build first and buy it later?

Sometimes, but it is not a common rule. The option depends on an agreement with the owner or developer. If you are considering it, have the terms, including the price and any crediting of rent towards it, put in writing and discuss them with a lawyer before signing.

When should I go ahead with buying a new build, and with what reserve?

You should have enough funds for furnishing, unexpected expenses and a possible increase in payments after the fixed-rate period ends. Consult a mortgage specialist on how large a reserve is appropriate for you, based on your income and obligations.