justyourcalculatorRent vs Buy Calculator
Whether renting or buying leaves you better off, year by year.
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Rent vs Buy Calculator
Is renting or buying cheaper over time?
Tax, insurance and HOA.
On money not tied up in the home.
Your marginal rate if you itemize mortgage interest and property tax; 0 if you take the standard deduction.
Buying saves over 10 years
$10,578
Buying pulls ahead in year 9
- Net cost of buyingEverything paid, minus home equity after selling costs and investments
- $218,763
- Net cost of rentingEverything paid, minus investments and deposit
- $229,341
- Upfront cost of buyingDown payment and closing costs
- $92,000
- Monthly mortgage payment
- $2,022.62
- Home value after 10 years
- $537,567
- Your equity after selling
- $234,029
- Total paid while buying
- $452,792
- Total paid while renting
- $306,910
Both paths spend the same cash each month: whoever pays less invests the difference at your investment return. Net cost = total cash put in minus what you'd have if you sold (or moved out) that year. Investment gains are shown before tax.
- Buying
- Renting
- Buying
- Renting
| Year | Home value | Equity after sale | Net cost buying | Net cost renting | Difference |
|---|---|---|---|---|---|
| 1 | $412,000 | $70,857 | $55,715 | $21,908 | -$33,806 |
| 2 | $424,360 | $86,291 | $75,160 | $43,992 | -$31,168 |
| 3 | $437,091 | $102,330 | $94,320 | $66,269 | -$28,051 |
| 4 | $450,204 | $119,001 | $113,176 | $88,757 | -$24,419 |
| 5 | $463,710 | $136,332 | $131,709 | $111,477 | -$20,232 |
| 6 | $477,621 | $154,354 | $149,899 | $134,450 | -$15,449 |
| 7 | $491,950 | $173,101 | $167,723 | $157,698 | -$10,025 |
| 8 | $506,708 | $192,604 | $185,158 | $181,245 | -$3,913 |
| 9 | $521,909 | $212,901 | $202,180 | $205,117 | $2,937 |
| 10 | $537,567 | $234,029 | $218,763 | $229,341 | $10,578 |
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How the rent vs buy calculator works
Buying costs the down payment and closing costs upfront, then the mortgage payment, property tax, insurance, HOA dues and maintenance. You get back the home's value when you sell, minus selling costs and what you still owe.
Renting costs rent and renter's insurance, which rise each year. The renter keeps the down payment invested, and in any month where renting is cheaper, invests the difference (and the buyer invests it when owning is cheaper). That makes the comparison fair.
Net cost for each path is all the cash put in minus the wealth you'd hold at the end of that year. The lower net cost wins; the chart shows the year buying pulls ahead, if it does.
Using and checking your result
Published by JustYourCalculator. Check the units and assumptions above, and compare a known example before relying on the output. Calculations use browser arithmetic and may round displayed values.
This is an educational estimate, not a lender quote, tax filing calculation or investment recommendation. Actual costs depend on current rules, fees and your circumstances. Verify important decisions with official sources and a qualified adviser.
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