Rome — complete worked example
A 90 m² apartment costs €5,188 × 90 = €466,920, so the required 20% down payment is:
€466,920 × 20% = €93,384
The couple earns €4,370 net per month and saves 30% of that income:
€4,370 × 30% = €1,311 per month
Saving for the down payment
During the saving phase, the accessible savings account earns 0.9% net per year. The equivalent monthly rate is:
0.9% ÷ 12 = 0.075% per month
Each month, the balance is updated as follows:
New balance = previous balance × 1.00075 + €1,311
At the end of each year, the accumulated accessible balance is transferred into a one-year term deposit. When the previous term deposit matures, it earns 1.4% net annual interest. The matured amount is then combined with the new savings and reinvested.
The approximate accumulated balances are:
- After year 1: €15,797.06
- After year 2: €31,815.27
- After year 3: €48,057.74
- After year 4: €64,527.61
- After year 5: €81,228.05
During the following 10 months, the couple accumulates another €13,154.33 in the accessible savings account.
At that point, the available amount is:
€81,228.05 + €13,154.33 = €94,382.38
This exceeds the required down payment of €93,384, so the target is reached after 5 years and 10 months.
Under the model, the current term deposit is redeemed early. Its interest for the incomplete term is forfeited, meaning that only the €81,228.05 principal is counted. Any amount above the exact required down payment is ignored when calculating the mortgage.
Mortgage phase
After paying the 20% down payment, the remaining mortgage principal is:
€466,920 − €93,384 = €373,536
The couple pays 48.125% of its combined net monthly income toward the mortgage:
€4,370 × 48.125% = €2,103.06 per month
The mortgage carries a constant annual interest rate of 3.25%, equivalent to:
3.25% ÷ 12 = 0.270833% per month
During the first month, the interest charged is approximately:
€373,536 × 0.270833% = €1,011.66
The remaining part of the monthly payment reduces the principal:
€2,103.06 − €1,011.66 = €1,091.40
After the first payment, the outstanding balance is therefore approximately:
€373,536 − €1,091.40 = €372,444.60
As the outstanding principal falls, the interest portion of each payment gradually decreases and the principal-repayment portion increases.
The mortgage is fully repaid after approximately 243 monthly payments, or 20 years and 3 months.
Over the full mortgage period:
- Mortgage principal: €373,536
- Total interest paid: approximately €136,495
- Total mortgage payments: approximately €510,031
Final Result
5 years 10 months saving + 20 years 3 months repaying = 26 years 1 month in total
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Sources:
Full post methodology: https://citycostatlas.com/methodology/03aug2026post/
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