Rent vs Buy Calculator

Is it better to rent or buy?

This rent vs buy calculator compares the money side of owning a home with renting and investing the difference. Enter the home price, mortgage details and your rent, choose how many years you plan to stay, and the calculator tells you which option leaves you better off.

How to use it

1. Buying: enter the home price, down payment %, mortgage rate, loan term, yearly property tax % and expected home price growth.
2. Renting: enter the monthly rent, yearly rent increase and the return you expect on investments.
3. Set the time horizon — how many years you expect to stay (for example 5 or 10).
4. Read the verdict and compare total buying cost, total rent paid, the future home value and the loan balance left.

How the comparison works

• Buying: you pay the down payment, the monthly mortgage and property tax. At the end you own a home that has grown in value, minus the loan still owed.
• Renting: you pay rent that rises each year, but you invest the down payment from day one, and each month you also invest the amount you save if rent is cheaper than the mortgage plus tax.
• The option with the higher net worth at the end of the time horizon wins.

What affects the answer most

• Time horizon: buying usually needs several years to beat renting, because early mortgage payments are mostly interest.
• Mortgage rate: higher rates favour renting.
• Home price growth vs investment return: if investments grow faster than home prices, renting and investing often wins.
• Price-to-rent ratio: when homes cost more than about 20 times a year of rent, renting is often cheaper.

What is not included

This is a simplified model. It does not include maintenance, closing costs, selling costs, home insurance, HOA fees or tax deductions. Add a margin for these — maintenance alone is often around 1% of the home value per year.

Frequently asked questions

Is renting throwing money away?

Not necessarily. Owners also pay interest, tax and maintenance that build no equity. Renting can win if you invest the money you save.

How many years should I use?

Use how long you realistically expect to live in the home. Try 5 and 10 years to see how the answer changes.