Mutual Fund vs Real Estate Calculator — A Real Comparison

Buying a property to rent out versus investing the same money in mutual funds is one of the most common financial decisions in India — and one of the most commonly oversimplified. We built a calculator that doesn't skip the real costs.

Why This Comparison Usually Gets Oversimplified

"Real estate always goes up" and "mutual funds are more liquid" are both true and both incomplete on their own. The real comparison needs actual numbers: registration costs, vacancy periods, maintenance, and how each path is taxed — all of which meaningfully change the answer and are easy to leave out of a back-of-envelope calculation.

What This Calculator Actually Accounts For

• Registration cost % — a real, sunk cost on day one, same as a down payment. Telangana runs roughly 6% urban, 7.5% rural — set your own rate
• Brokerage on purchase — another real, often-forgotten upfront cost
• Vacancy allowance — the property won't be rented every month of every year; the calculator lets you set a realistic vacancy %
• Maintenance costs — an ongoing annual drag on returns, as a % of property value
• Tax treatment — rental income taxed at your slab rate, capital gains on both paths taxed appropriately at exit

The Net Yield Number That Usually Surprises People

Gross rental yields of 2-4% are commonly quoted — but after vacancy, maintenance, and tax on the rental income itself, the net yield that actually reaches you is usually meaningfully lower. The calculator shows both numbers side by side, so you see exactly how much the "real costs" eat into the headline yield.

The Break-Even Appreciation Rate

Given how thin net rental yields often are, most of a real estate investment's total return has to come from price appreciation. The calculator solves for the exact appreciation rate needed for real estate to match a mutual fund investment at your chosen return — a specific, checkable number rather than a general assumption about "property always appreciating."

What It Doesn't Replace

Liquidity is a real, non-financial difference this calculator can't fully capture: a mutual fund can be sold in days, while a property sale typically takes months and depends on finding a buyer at your price. Factor this into your decision alongside the numbers, not instead of them.