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Rent vs buy calculator

Compare long-term renting and buying scenarios with editable assumptions for housing costs, appreciation, rent growth, and investment return.

  • Neutral rent/buy cost comparison
  • Home equity estimate
  • Break-even year when buying wins
Compare rent and buy

Inputs

Rent vs Buy Calculator

Inputs

Use current rent before utilities unless utilities are included in rent.

Use the purchase price or scenario price before financing costs.

Enter cash paid up front. Use 0 if there is no down payment.

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Scenario return for cash that would not be used in the buying case.

Use the time horizon you realistically expect to compare.

Formula and method

Rent versus buy method

rent net cost = rent paid − invested down payment; buy net cost = cash costs − equity

The buying scenario estimates mortgage payments, taxes, maintenance, insurance, home value, and remaining loan balance.

The renting scenario compounds the down payment as if it were invested.

Assumptions

  • Selling costs, taxes, HOA fees, and transaction costs are not fully modeled.
  • Investment return is applied to unused down payment.
  • Home appreciation and rent growth are constant scenario assumptions.

Practical examples

Seven-year comparison

$2,200 rent, $430,000 home, 20% down

Net renting cost, net buying cost, equity, and advantage

Higher appreciation

Raise home appreciation assumption

Buying may break even earlier

FAQ

Is this financial advice?

No. It is a simplified model for comparing assumptions.

Does it include selling costs?

Not in this simplified model. Add caution when comparing short time horizons.

What is home equity?

Estimated home value minus remaining mortgage balance.

Why include investment return?

Renting may leave down payment cash available to invest, so the model includes that opportunity cost.

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