How it works
Compare the financial impact of buying a home versus renting over a specific period.
Input query strings and outputs
Use an input name in this page’s URL as ?name=value, and join additional inputs with &. Portable shared links may instead use the compact ?ac= state parameter.
Input query strings
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?homePrice=Home priceMoney · Required · Default: 400,000
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?downPayment=Down payment (%)Percentage · Required · Default: 20
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?interestRate=Mortgage annual rate (%)Percentage · Required · Default: 6.5
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?term=Mortgage term (whole years)Number · Required · Default: 30
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?buyingCosts=Buying costs (% of price)Percentage · Required · Default: 3
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?sellingCosts=Selling costs (% of sale value)Percentage · Required · Default: 6
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?homeAppreciation=Annual home appreciation (%)Percentage · Required · Default: 3
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?maintenance=Annual maintenance (% of current value)Percentage · Required · Default: 1
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?propertyTax=Annual property tax ($)Money · Required · Default: 0
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?insurance=Annual home insurance ($)Money · Required · Default: 0
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?hoa=Monthly HOA ($)Money · Required · Default: 0
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?extraPayment=Extra monthly principal ($)Money · Required · Default: 0
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?monthlyRent=Initial monthly rent ($)Money · Required · Default: 2,500
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?rentIncrease=Annual rent increase (%)Percentage · Required · Default: 3
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?investmentReturn=Annual effective investment return (%)Percentage · Required · Default: 7
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?years=Comparison horizon (whole years)Number · Required · Default: 7
Outputs
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resultConditional comparisonText · Primary output
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ownerWealthownerWealthCurrency
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renterWealthrenterWealthCurrency
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differencedifferenceCurrency
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loanBalanceloanBalanceCurrency
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scheduledPaymentscheduledPaymentCurrency
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equityequityCurrency
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totalInteresttotalInterestCurrency
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totalBuyOutflowtotalBuyOutflowCurrency
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totalRentOutflowtotalRentOutflowCurrency
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ownerInvestmentownerInvestmentCurrency
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renterInvestmentrenterInvestmentCurrency
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payoffMonthPayoff monthText
result contains the calculator’s complete rendered result area, including its visible result cards, tables, charts, and messages.
Compare the long-term cost of leasing vs. homeownership
Description
The Rent vs. Buy Calculator is a comprehensive financial simulator designed to answer one of life’s biggest questions. It goes beyond a simple monthly payment comparison by factoring in home appreciation, maintenance costs, closing fees, and the “opportunity cost” of your down payment (calculated as what that cash could have earned if invested in the stock market instead).
Inputs
- Buying Assumptions:
- Home Price: The purchase price of the target home ($).
- Down Payment: The percentage of the price paid upfront (%).
- Interest Rate & Term: Your mortgage loan details.
- Buying Costs: Upfront fees like inspections and appraisals (%).
- Home Appreciation: The estimated annual increase in property value (%).
- Maintenance/Yr: Annual costs for repairs and upkeep (%).
- Renting Assumptions:
- Monthly Rent: The starting cost to rent a similar property ($).
- Rent Increase/Yr: The estimated annual hike in rent (%).
- Inv. Return: The annual return you would expect to earn if you invested your down payment cash in the market (%).
- Comparison Period: How many years you plan to live in the property.
Outputs
- Result Recommendation: A clear statement on which option is more cost-effective over the selected period.
- Estimated Savings: The total dollar amount you save by choosing the superior option.
- Net Cost of Buying: Total payments plus maintenance, minus the equity gained when selling (after 6% commission).
- Net Cost of Renting: Total rent paid minus the gains you would have made from investing your initial capital.
Chart
- N/A: This tool provides a deep-dive financial recommendation based on long-term projections.
“Good to Know”
- The “5-Year Rule”: Generally, if you plan to move in less than 5 years, renting is often cheaper due to the high upfront and backend costs of buying and selling a home.
- Equity is Key: Buying is a form of “forced savings.” At the end of the period, you own an asset that (hopefully) has increased in value, while rent payments are permanent outflows.
- Maintenance Matters: A common mistake is forgetting that as a homeowner, you are “the landlord.” Expect to spend at least 1% of the home’s value every year on maintenance.
Examples
Example 1: Long-term Stability
- Input:
- Home: $400k, Rent: $2,500
- Period: 10 Years
- Output:
- Buy wins by a significant margin due to 10 years of appreciation and principal paydown.
Example 2: Short-term Move
- Input:
- Period: 2 Years
- Output:
- Rent wins because the 3% buying costs and 6% selling commission far outweigh any equity gained in just 24 months.
Example 3: Bullish Rental Market
- Input:
- Rent Increase: 6%
- Output:
- Shows how rapidly rising rents make homeownership (with a fixed mortgage) much more attractive over time.