Rent vs Buy Calculator

To use this rent vs buy calculator:

1. Enter the home price of the property you are considering purchasing.
2. Set your down payment percentage using the slider.
3. Enter the mortgage interest rate offered by your lender.
4. Choose a loan term (15 or 30 years).
5. Enter your current or expected monthly rent.
6. Adjust the annual rent increase and home appreciation rates to match your local market.
7. Set the property tax rate for your area.
8. Optionally adjust home insurance and maintenance costs in the advanced settings.
9. Choose how many years to compare to see the long-term picture.

The calculator instantly shows the total cost of each option, potential savings, equity built, and a clear recommendation.

A rent vs buy calculator is a financial planning tool that compares the total cost of renting a home with the total cost of buying one over a specified period. It accounts for mortgage payments, property taxes, insurance, maintenance, home appreciation, rent increases, and the equity you build as a homeowner.

The decision to rent or buy is one of the most significant financial choices most people face. While buying builds equity and offers potential appreciation, renting provides flexibility and avoids the substantial upfront and ongoing costs of homeownership. This calculator helps you make an informed, data-driven decision based on your specific financial situation and local market conditions.

The rent vs buy comparison uses several formulas:

• Monthly Mortgage Payment: M = P × [r(1 + r)^n] / [(1 + r)^n − 1]
• Total Cost of Buying: Down Payment + Mortgage Payments + Property Taxes + Insurance + Maintenance − Home Equity Built
• Home Equity: Down Payment + Principal Paid + Home Appreciation
• Total Cost of Renting: Sum of monthly rents with annual increases: R × 12 × [(1 + g)^t − 1] / g where g is the annual rent growth rate
• Savings: Total Cost of Renting − Net Cost of Buying (positive = buying wins)

Example: A $350,000 home with 20% down ($70,000), a 6.5% mortgage rate over 30 years, compared with $1,800/month rent increasing 3% annually over 7 years. The monthly mortgage payment is approximately $1,770. Over 7 years, buying costs roughly $177,000 net (after subtracting equity built), while renting costs approximately $163,000. In this scenario, renting is slightly cheaper over 7 years, but extending the comparison to 10 or more years typically favors buying as equity grows and rent continues to rise.