Finance Flagship Tool

Rent vs Buy Calculator

Run a side-by-side scenario with crossover timing, wealth outcome, and year-by-year details.

Buy Scenario

Home PriceDown Payment (%)Mortgage Rate (%)

Rent + Invest Scenario

Monthly RentAnnual Rent Increase (%)Investment Return (%)Time Horizon (Years)

Side-by-Side Results

Run the comparison and unlock full outputs.

How to use this calculator for a real decision

Compare the total wealth outcome of renting versus buying a home over a chosen time horizon. Enter home price, down payment, mortgage rate, monthly rent, expected rent increases, investment return on savings, and how long you plan to stay. The calculator compares home equity growth against investment returns on the money you save by renting. Run multiple scenarios: buying with 20% down vs 5% down, staying 5 years vs 10 years, and different rent growth assumptions.

Worked example

A $300,000 home with 20% down at 6.5% costs about $2,100/month including taxes and insurance. Renting a comparable home costs $1,800/month with 3% annual increases. The renter invests the $60,000 down payment plus monthly savings at 7% return. Over 5 years, buying builds ~$30,000 equity but costs ~$60,000 in interest and ~$15,000 in maintenance and closing costs. Renter investments grow to ~$78,000. Renting wins at 5 years. Over 10 years, buying typically pulls ahead as equity builds and rent rises.

Common mistakes to avoid

Ignoring maintenance and transaction costs: Buyers pay 2-5% closing costs and 5-6% selling costs. Include these or buying looks artificially better.

Comparing rent to mortgage only: Taxes, insurance, PMI, HOA, and maintenance add 30-50% to the true monthly cost of owning.

Forgetting down payment opportunity cost: The down payment could earn 7-10% in the market instead of being tied up in a home.

Assuming 3-5% annual appreciation: Use a conservative 2-3% and run a downside case at 0% appreciation to stress-test the decision.

Key terminology

Equitycurrent home value minus remaining mortgage balance

PMIPrivate Mortgage Insurance required when down payment is under 20%

Closing costsone-time fees at purchase typically 2-5% of the loan amount

Opportunity costwhat your down payment and monthly savings could earn if invested instead of put into a home

Crossover yearthe year when total wealth from buying exceeds total wealth from renting

Frequently asked questions

Does the calculator include tax benefits?

Mortgage interest and property tax deductions are modeled approximately. Most homeowners no longer itemize after 2018 tax law changes.

What time horizon should I use?

Under 5 years renting usually wins. Over 7-10 years buying typically builds more wealth. Run both to find your crossover point.

How does down payment size affect the decision?

Larger down payments reduce monthly costs and eliminate PMI, making buying more attractive. Smaller down payments favor renting for longer.

Is buying always better long-term?

Not always. If home appreciation is flat and investments perform well, renting can win even over long horizons. Run your actual local numbers.