Rent vs Buy Calculator
Compare the true costs of renting vs buying a home over time. Includes all hidden costs and opportunity costs to help you make the best decision.
How to Use This Calculator
- Enter your current monthly rent and expected annual increases
- Input the home price you're considering and your down payment
- Set your mortgage interest rate and loan term
- Add property taxes, insurance, and maintenance costs
- Include HOA fees if applicable
- Set the comparison period (how many years to compare)
- View detailed cost breakdown and recommendations
Renting Costs
1. Monthly Rent Payments:
• Base monthly rent
• Annual rent increases applied
• Summed over comparison period
2. Renters Insurance:
• Monthly insurance cost
• Multiplied by comparison period
3. Opportunity Cost:
• Security deposit investment potential
• Calculated using compound interest
Buying Costs
1. Mortgage Payments:
• Principal and interest payments
• Calculated using amortization formula
• Summed over comparison period
2. Property Taxes:
• Annual property tax rate × home value
• Multiplied by comparison period
3. Home Insurance:
• Annual insurance cost
• Multiplied by comparison period
4. Maintenance Costs:
• Percentage of home value annually
• Multiplied by comparison period
5. HOA Fees:
• Monthly HOA fees
• Multiplied by comparison period
6. Closing Costs:
• One-time costs at purchase
• Percentage of home value
Equity and Comparison
1. Equity Built:
• Down payment amount
• Principal portion of mortgage payments
• Reduces total buying cost
2. Cost Comparison:
• Total Buying Cost - Total Rent Cost
• Positive = renting cheaper
• Negative = buying cheaper
3. Monthly Average:
• Cost difference ÷ (years × 12)
• Shows monthly cost advantage
Important Notes:
- This analysis assumes you'll stay in the same home for the comparison period
- Home value appreciation is not included in this calculation
- Consider your lifestyle preferences and flexibility needs
- Factor in moving costs and market timing
- Consult with a financial advisor for personalized advice
How Rent vs Buy Calculator Works
This comprehensive calculator compares the true costs of renting vs buying a home over time, including all hidden costs and opportunity costs.
Total Rent Cost = Sum of monthly rent over comparison period + insurance + opportunity cost
Includes rent increases, renters insurance, and opportunity cost of security deposit.
Monthly Mortgage Payment = P × [r(1 + r)^n] / [(1 + r)^n - 1]
Where P = Principal, r = Monthly Interest Rate, n = Total Number of Payments
Total Buying Cost = Mortgage payments + property tax + insurance + maintenance + HOA + closing costs - equity built
Includes all ownership costs minus the equity you build over time.
Equity Built = Down payment + (loan amount - remaining balance)
The portion of your home you actually own, which reduces the true cost of buying.
Opportunity Cost = Security deposit × (investment return rate)^years
The potential investment returns you could earn on your security deposit.
Cost Difference = Total Buying Cost - Total Rent Cost
Positive value means renting is cheaper, negative means buying is cheaper.
Monthly Cost Difference = (Total Buying Cost - Total Rent Cost) ÷ (years × 12)
The average monthly cost difference over the comparison period.
Break-Even Point = When Total Buying Cost = Total Rent Cost
The point in time when buying becomes more cost-effective than renting.