What this calculator does
Rent or buy comparison works out net cost of renting versus buying a home over the years you plan to stay. Enter your own figures above and the answer updates as you type: nothing is fixed in the code, so the result reflects exactly the numbers you supply.
The formula this calculator evaluates is printed under the tool and explained below, so you can check the working by hand or reuse it in a spreadsheet.
The formula
FormulaNet cost of buying = down payment + closing costs + P&I payments + ownership costs + selling costs − home equity at exit; Net cost of renting = rent paid − growth earned on the money not spent on a down payment
The inputs explained
| Field | What to enter |
|---|---|
| Home price ($) | A number, measured in your currency. Starts at 500000. |
| Down payment (%) | A number, measured in %. Starts at 20. |
| Mortgage interest rate (%) | A number, measured in %. Starts at 6.5. |
| Mortgage term (years) | A number, measured in years. Starts at 30. |
| Years you plan to stay | A number. Starts at 7. |
| Comparable monthly rent ($) | A number, measured in your currency. Starts at 2200. |
| Annual rent growth (%) | A number, measured in %. Starts at 3. |
| Annual home price appreciation (%) | A number, measured in %. Starts at 3. |
| Return if the down payment were invested instead (%) | A number, measured in %. Starts at 6. |
| Property tax, insurance & maintenance (% of value per year) | A number, measured in % of value per year. Starts at 2.5. |
| Buying closing costs (% of price) | A number, measured in % of price. Starts at 2. |
| Selling costs at exit (% of sale price) | A number, measured in % of sale price. Starts at 7. |
Worked examples
Every figure in the tables below is produced by this page’s own calculator at build time, so the numbers and the tool always agree. Select any row to load that scenario.
How the answer changes with home price
Every other input is held at the calculator’s starting values while home price varies. Select any row to load that scenario into the calculator.
How the answer changes with home price
| Home price ($) | Buying is cheaper by | Net cost of buying | Net cost of renting |
|---|---|---|---|
| 250,000 | $71,695.96 | $104,739.34 | $176,435.30 |
| 375,000 | $5,016.13 | $157,109.01 | $162,125.14 |
| 500,000 | $61,663.70 | $209,478.67 | $147,814.97 |
| 750,000 | $195,023.37 | $314,218.01 | $119,194.64 |
| 1,000,000 | $328,383.04 | $418,957.35 | $90,574.31 |
| 1,500,000 | $595,102.37 | $628,436.02 | $33,333.65 |