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Rent vs. buy calculator

Compare accumulated renting cost with the net cost of buying over the same horizon, including financing, home appreciation, and configurable ownership costs.

INPUTSEnter your figures
METHODOLOGY

Transparent calculation

Compare accumulated renting cost with the net cost of buying over the same horizon, including financing, home appreciation, and configurable ownership costs.

Calculation equationDifference = total rent cost − net buying costPreset assumptions can be adjusted in the calculator when applicable.
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Break-even rent→Price-to-rent ratio→Gross rent multiplier (GRM)→Real estate investment over 30 years→DSCR loan calculator→Real estate investment over 25 years→
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Results are mathematical estimates based solely on the values entered. They are not financial, investment, tax or legal advice, nor an offer or recommendation of any financial product.

FinanceCalc · 2026

Renting versus buying: a model of total costs

A monthly mortgage payment alone cannot answer the rent-or-buy question. This model includes monthly rent with annual increases and the estimated cost of owning, buying and eventually selling a property over the selected horizon. The result is a difference between modeled total costs, not an affordability approval.

Formula

Difference = total rent cost − net buying cost

Net buying cost = down payment + paid mortgage installments + ownership costs + buying costs + selling costs + remaining mortgage balance − estimated future home value. A positive difference means buying is cheaper in this particular simplified model; a negative difference favors renting.

Worked example with the default inputs

Monthly rent: $1,500 · Annual rent increase: 3% · Home price: $300,000 · Down payment: $60,000 · Mortgage annual rate: 5% · Mortgage term: 30 years · Years to compare: 7 years · Home appreciation: 3% · Annual ownership costs: 2% · Buying costs: 3% · Selling costs: 6%

$49,853.92

Modeled net cost of buying: $88,070.40

Scenario comparison

Monthly starting rentResult
$1,200.00$22,269.06
$1,500.00$49,853.92
$1,800.00$77,438.79

The three rows change only starting monthly rent. Both rent inflation and home appreciation are assumptions, not predictions. The comparison does not model investment returns on the down payment, financing origination details, tax benefits, or all local expenses; treat it as a sensitivity exercise, not a purchase recommendation.

Frequently asked questions

Why does my result change so much with the time horizon?

It changes the number of rental payments, the home value assumption, owner expenses and the amount of mortgage debt remaining.

Does a positive result mean I should buy?

No. Liquidity, property risk, mobility, unexpected repairs and investment opportunity costs are not fully represented by this simplified model.

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These tools cover calculations that often come before or after this step.

MortgagesMortgage paymentLoansLoan comparison calculatorInvestmentsInvestment future valuePersonal FinanceMonthly budget calculator
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