Rent or buy in Baku? The answer in market numbers
We measured it across 380,000 listings: how much of a flat's price the rent returns each year, where the ratio is best, and at which interest rate buying starts to beat renting. Worked examples and a free calculator.
The usual reasoning goes like this: pay the same money into a mortgage rather than into rent, and at the end the flat is yours. That is half true. Part of every payment is interest, which is gone just as rent is, and only the rest becomes your equity. The question is which part is larger.
This article answers with the market's own numbers rather than an opinion. At the end you can put your own figures into the rent versus buy calculator.
How much of the price does rent return in Baku
We collect both sides of the market, listings for sale and listings for rent. The September 2026 crawl holds 249,474 sale listings and 130,815 monthly rental listings, with daily lets removed.
City-wide averages:
| Measure | Value |
|---|---|
| Sale price | 2,867 ₼/m² |
| Monthly rent | 12.1 ₼/m² |
| Annual gross yield | 5.1% of the price |
| Years of rent to equal the price | about 20 |
In other words, an average flat let continuously for 20 years collects roughly what it costs today. By international standards that is an ordinary figure, but next to a mortgage rate it says a great deal.
Every district lands between 4.37% and 4.68%, so the choice of district does not change the ratio. Source: bina.az listings, September 2026 (249,474 for sale, 130,815 monthly rentals).
Central districts are tighter still:
| Area | Sale, ₼/m² | Rent, ₼/m² | Yield | Years |
|---|---|---|---|---|
| 28 May | 3,413 | 13.3 | 4.68% | 21.4 |
| 20 Yanvar | 2,879 | 11.1 | 4.62% | 21.7 |
| Şah İsmayıl Xətai | 3,498 | 13.5 | 4.62% | 21.6 |
| 8 Noyabr | 2,960 | 11.3 | 4.59% | 21.8 |
| Nəsimi | 3,141 | 11.9 | 4.55% | 22.0 |
| Nizami | 3,269 | 12.2 | 4.49% | 22.3 |
| İnşaatçılar | 2,640 | 9.7 | 4.43% | 22.6 |
| Memar Əcəmi | 2,660 | 9.7 | 4.38% | 22.9 |
| Yasamal | 2,859 | 10.4 | 4.37% | 22.9 |
An expensive district has expensive rent, but prices rise faster than rents, so the ratio lands in the same narrow band everywhere, between 4.4% and 4.7%. Which district you pick barely changes the rent-or-buy answer. The real difference is elsewhere.
Small flats return more
The difference that matters is the number of rooms:
The second figure: years of rent needed to equal the price. Source: bina.az listings, September 2026 (249,474 for sale, 130,815 monthly rentals).
| Rooms | Sale, ₼/m² | Rent, ₼/m² | Yield | Years |
|---|---|---|---|---|
| 1 | 3,264 | 15.8 | 5.81% | 17.2 |
| 2 | 2,957 | 12.5 | 5.08% | 19.7 |
| 3 | 2,771 | 10.9 | 4.73% | 21.2 |
| 4 | 2,814 | 10.4 | 4.43% | 22.6 |
A one-room flat returns a third more than a four-room one. The reason is simple: a tenant needs somewhere to live rather than a number of rooms, so the square metre of a small flat rents for more. For an investment, smaller is better. For living in, a larger flat is relatively cheaper to own than to rent.
The comparison that matters: a 5% yield against an 8% loan
Put the two numbers side by side.
- A flat returns about 5% a year in rent.
- The Fund's ordinary mortgage costs 8%, the preferential one 4%, and a bank's own internal mortgage effectively 12% to 16% a year.
When the loan costs more than the asset yields, renting is cheaper on pure cash flow. Two things make buying win, and neither is the interest rate:
- Repaid principal is not a cost. Part of the payment is interest, which really is gone, and the rest becomes your own equity. An honest comparison therefore weighs rent against the interest alone.
- Price growth. If the flat appreciates, the gain is yours and not the landlord's.
Without those two, borrowing at 8% to hold an asset yielding 5% would make no financial sense.
Worked example: a 250,000 ₼ flat
Terms: 20% down (50,000 ₼), a 20-year loan, the same flat renting for 900 ₼ a month, and price growth set to zero, meaning we forecast nothing.
| Rate | Monthly | Cost of buying over 7 years | Cost of renting over 7 years | Buying wins from year |
|---|---|---|---|---|
| 4% preferential | 1,212 ₼ | 49,045 ₼ | 75,600 ₼ | 1 |
| 8% ordinary state | 1,673 ₼ | 102,454 ₼ | 75,600 ₼ | 19 |
| 14% bank loan | 2,487 ₼ | 187,181 ₼ | 75,600 ₼ | never within 30 |
20% down, a 20-year loan, price growth 0%. Change the assumptions and the answer updates as you go.
The grid varies the rent as well, because the answer depends not only on the rate but on what you pay in rent today. Same flat, same rent, only the rate differs, and the answer flips completely. At 4% buying is cheaper from the first year. At 8% renting stays cheaper for 19 years. At a bank rate buying never overtakes renting at all: there is no break-even within 30 years.
So the rent-or-buy answer depends first on which mortgage you qualify for, not on the market.
Price growth changes everything
The table above assumes no price growth. Moving that assumption a little turns the answer over:
A 250,000 ₼ flat, 20% down, a 20-year loan, rent of 900 ₼ a month. Change the assumptions and the answer updates as you go.
Just 2% a year pulls break-even from year 19 to year 2, and 3% pulls it to the first year. The reason is arithmetic: interest accrues on the loan alone, while price growth applies to the whole value of the flat. A small assumption is therefore a large amount of money.
That is the heart of it: the decision to buy is largely a bet on appreciation. We do not forecast the future, so the calculator defaults to zero. Enter your own expectation and watch the answer move. If you want the cautious version, leave it at zero and read the result as the worst case.
Does the tenant pay your mortgage
The popular idea from Robert Kiyosaki's Rich Dad Poor Dad runs like this: buy a flat with a mortgage, rent it out, and the tenant repays the loan for you. Here is what that looks like in Baku numbers.
- Monthly payment
- 1,673 ₼
- Rent pays
- 900 ₼
- Out of your pocket
- 773 ₼
A 250,000 ₼ flat, a 20-year loan, rent of 900 ₼ a month (the market average). Change the assumptions and the answer updates as you go.
A 250,000 ₼ flat, 20% down, a 20-year loan and the market rent of 900 ₼:
| Rate | Monthly payment | Share the rent pays | Out of your pocket |
|---|---|---|---|
| 4% preferential | 1,212 ₼ | 74% | 312 ₼ |
| 8% ordinary | 1,673 ₼ | 54% | 773 ₼ |
| 14% bank | 2,487 ₼ | 36% | 1,587 ₼ |
In Baku the tenant does not pay your mortgage. The tenant pays about half of it. The reason is the same number as before: rent yields about 5% while the loan costs 8% or more. In the markets the book was written for, yields sat above borrowing rates. Here they sit below.
The down payment needed for the rent to cover the payment in full:
- at the 4% preferential rate: 41%
- at the 8% ordinary rate: 57%
- at a 14% bank rate: 72%
None of this makes letting pointless. Part of each payment is interest, which is a cost, and the rest becomes your equity, with a tenant funding about half of it. After 20 years the flat is yours and someone else paid for roughly half of the payments. It is simply not an investment that carries itself: you top it up every month.
The calculation also leaves out everything that works against you, such as void months, repairs, agent fees and tax. One thing works in your favour: the mortgage payment is fixed while rents rise over time, so the gap narrows.
How we calculate it
The method is plain, with no hidden coefficients:
- Cost of buying = interest paid, plus what the down payment would have earned on deposit, minus the flat's price growth.
- Cost of renting = the rent paid over the horizon, compounded by annual rent growth.
- Break-even year = the first year the running cost of buying falls below the running cost of renting.
they meet in year 19
A 250,000 ₼ flat, 20% down, a 20-year loan, rent 900 ₼, price growth 0%. Change the assumptions and the answer updates as you go.
Repaid principal is excluded because it stays yours. The down payment, by contrast, counts as a missed opportunity: parked in a deposit it would have earned interest.
When to buy and when to rent
What the numbers imply in practice:
- If you qualify for the preferential mortgage, buy. A 4% rate sits below the rental yield, and buying leads from the first year.
- If you will stay under five years, rent. At the ordinary rate the break-even is year 19, and the one-off costs of a purchase come on top.
- If rent is expensive, run the numbers. At 1,200 ₼ instead of 900 ₼ for the same flat, break-even moves from year 19 to year 8.
- For an investment, look at small flats. One-room units return 5.81%, four-room units 4.43%.
- Buying to let means a bigger down payment. At 8% the rent covers the whole payment only from 57% down.
Where the numbers come from
The figures come from the September 2026 crawl of bina.az listings: 249,474 for sale and 130,815 for monthly rent. These are asking prices, not transaction prices, so real figures usually land a little lower. Daily lets are excluded, 1,603 of them flagged as daily and more identified from the text, because they distort the monthly market. For the same reason resort areas such as Sea Breeze are left out of the tables: summer rents multiplied by twelve months produce an artificially high yield there.
To check your own flat: the rent versus buy calculator, the mortgage calculator and how much you can afford.
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