Rent vs. Buy Calculator

Compare the true net worth of buying a home vs. renting and investing the difference

Home Purchase Assumptions

Home Purchase Price

Down Payment (%)

Mortgage Rate (APR %)

Mortgage Term (Years)

yrs

Home Appreciation / Yr

Taxes, Insurance & Maint. / Yr

Renting & Investment Assumptions

Current Monthly Rent

Annual Rent Increase (%)

Investment Return (APR %)

Planned Stay (Years)

yrs

NET WORTH COMPARISON

-

Monthly Mortgage (P&I)

Upfront Cash (Down + 3% Closing)

Buyer Net Worth at Horizon

Renter Net Worth at Horizon

Net Wealth at End of Planned Stay

Buy Home (Net Home Equity + Savings) -

Rent & Invest (Down Payment + Monthly Difference) -

Year-by-Year Net Worth & Equity Schedule

Year	Home Value	Mortgage Balance	Buyer Net Worth	Renter Net Worth	Buy vs. Rent Advantage

Explore Your Mortgage Options

Loan & Mortgage Amortization

Simulate extra principal payments and compare French vs. German mortgage amortization tables.

Pay Off Mortgage Early vs. Invest

Already buying? See whether extra monthly cash should go toward your mortgage or an index fund.

How Our Rent vs. Buy Calculator Works

Most people compare monthly rent directly to a monthly mortgage payment, which ignores the two biggest financial factors in housing: unrecoverable ownership costs (closing costs, property taxes, insurance, maintenance, and realtor commissions when selling) and the opportunity cost of the down payment.

This calculator runs a month-by-month simulation where both the Buyer and the Renter start with the exact same upfront cash (Down Payment + 3% Buyer Closing Costs) and the exact same monthly housing budget:

If renting is cheaper in a given month: The Renter invests the monthly cash savings into their investment portfolio.
If owning becomes cheaper in later years (as rent rises with inflation): The Buyer invests the monthly cash savings into their own investment portfolio.
At the end of your horizon: We calculate the Buyer's net home equity (after deducting 5% selling costs and remaining mortgage principal) plus any accumulated buyer investments, and compare it against the Renter's total portfolio.

Frequently Asked Questions

A mortgage payment is only part of homeownership costs—buyers also pay closing costs, property taxes, homeowners insurance, HOA fees, maintenance, and tie up a large down payment that could otherwise earn compound returns in an investment portfolio. Conversely, part of each mortgage payment builds equity and home values appreciate over time.

The break-even year is the year when a homeowner's net equity (after deducting 5% selling costs) exceeds the investment portfolio of a renter who invested the down payment and any monthly cash-flow savings.