Renting and buying aren’t directly comparable on monthly payment alone — buying builds equity that’s recovered at sale, while every dollar of rent is a cost with nothing given back. This calculator compares the two on a net-cost basis over a chosen number of years.
How it works
Renting’s cost is simply the rent paid, growing each year. Buying’s cost adds the down payment, closing costs, mortgage payments, property tax, and maintenance — then subtracts what would be recovered by selling: the home’s projected value at that point, minus selling costs and whatever mortgage balance remains.
Why the mortgage principal isn’t counted as a pure cost
Every mortgage payment is included in full, principal and interest together, because the principal portion isn’t lost — it becomes equity, which the sale-proceeds subtraction gives back at the end. Only counting the interest portion as a “cost” would double-count, since the principal repayment is already reflected in the smaller remaining mortgage balance being subtracted.
How to use this calculator
- Enter the home price, financing terms, and ongoing ownership costs.
- Enter a comparable rent and how many years you plan to stay.
Frequently asked questions
Why does buying look worse over a short time horizon?
Closing costs and selling costs are large fixed amounts that get spread over fewer years — the shorter the stay, the more those upfront and exit costs dominate the comparison.
Does this include the mortgage interest tax deduction?
No — that depends on itemizing rather than taking the standard deduction, which varies by household and isn’t reflected here.
What if home prices don’t appreciate at all?
Set appreciation to 0% — buying’s breakeven point simply takes longer, since there’s less equity gain to offset the upfront and ongoing costs.
