What owners pay and don’t get back
Only the part of a mortgage payment that repays the loan builds wealth. These don’t:
| Cost | Roughly, each year |
|---|---|
| Mortgage interest | Most of each payment in the early years |
| Local Property Tax | A few hundred euro for most homes |
| Repairs and maintenance | Often 1% or more of the value |
| Home insurance, management fees (apartments) | Varies |
| What the deposit could earn | The return you give up by not investing it |
Buying also has one-off costs: stamp duty (1% of the price on homes up to €1 million), solicitor’s fees, a valuation and a survey. On a €400,000 home, stamp duty alone is €4,000. Selling costs money too, in estate agent and legal fees, so moving often eats into what you gain from owning.
A rule of thumb
A quick comparison: the costs of owning that you don’t get back come to roughly 4% of the home’s value a year. That’s about 1% for repairs and Local Property Tax, and about 3% for the cost of the money tied up, through mortgage interest or the returns your deposit could earn.
| Part | Amount |
|---|---|
| Repairs and Local Property Tax (about 1% a year) | €333.33 |
| Mortgage interest, or the return your deposit could earn (about 3%) | €1,000.00 |
| Cost of owning a month | €1,333.33 |
Before one-off costs such as stamp duty and legal fees. Compare the total with the rent on a similar home: if rent is higher, buying is likely to work out cheaper over time; if it's lower, renting may be.
4% of €400,000 is €16,000 a year, or about €1,333 a month. In much of Ireland, rent for a similar home is higher than that, which is why buying often works out cheaper over time. Where rents are lower, or you might move within a few years, renting can be the better choice.
Renting has its own tax help: the rent tax credit gives back 20% of your rent, up to €1,000 a year for a single person in 2026, which takes about €83 a month off the cost. See the rent tax credit.
When renting makes more sense
- You might move within a few years, before stamp duty and the other costs of buying are earned back.
- You’d invest the difference between renting and owning, and stick to it. A pension is the most tax-efficient place for it.
- You need flexibility for work or family.
- You can’t yet save the 10% deposit without stretching yourself. See the first-time buyer guide.
Bottom line
Rent pays for a home to live in, just as an owner’s interest and repairs do. Compare the full costs, not rent against the mortgage payment. Our rent vs buy calculator compares the two over time, and how much can I borrow? shows what you could buy.