Rent vs Buy Calculator

Make an informed decision about one of life's biggest financial choices. Compare the true costs of renting versus buying a home.

This calculator compares buying a home versus renting and investing the difference. It accounts for mortgage payments, property taxes, maintenance, home appreciation, investment returns, and tax benefits. The results show your net wealth after your chosen time horizon, helping you make the best financial decision for your situation.

Calculator Inputs

Load typical values for your area

$
%
%

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How long do you plan to stay?

$

Property Costs

%

Preset default: 0.73%

%

CA Prop 13 limits to 2% annually

$

Preset default: $470

%

Percentage of home value annually

Transaction Costs

%

Preset default: 3.0%

%

Preset default: 7.0%

Market Assumptions

%

Preset default: 4.5%

%

Preset default: 3.0%

%

Stock market average return

Tax Calculations

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Your tax bracket for deductions

Subject to standard deduction limits

Results

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Equal Monthly Budget Assumption

This comparison assumes you have the same monthly budget for both scenarios. When buying costs more per month, the renter invests the difference in the stock market.

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BUYING

$1,699,892

Net Equity After Selling

Monthly P&I:$4,804
Total Interest:$815,948
Total Property Tax:$168,502
Net Result = What you get back minus expenses that are GONE forever (interest, taxes, HOA, maintenance, selling costs)

Total Invested

Down payment:$190,000
Closing costs:$28,500
Principal payments:$336,944
Total invested (in equity):$555,444

Total Costs Over Time

Total interest paid:$815,948
Total property tax:$168,502
Total HOA fees:$112,800
Total maintenance & insurance:$304,127
Selling costs:$159,792
Less: Tax savings:($236,268)
Total pure expenses:$1,324,901

Home's Value After 20 Yrs

Home market value:$2,282,740
Remaining mortgage:($423,056)
Selling costs:($159,792)
Final home equity:$1,699,892

Net Result Calculation

Final equity:$1,699,892
Minus pure expenses:($1,324,901)
= Net Wealth (After 20 Yrs):+$374,991
Note: Down payment and principal payments are not subtracted because they're already part of your equity
đŸĸWinner

RENTING + INVESTING

$2,433,019

Investment Portfolio Value

Starting Rent:$3,800/mo
Final Rent:$6,663/mo
Total Invested:$218,500
Net Result = What you get back minus pure expenses (rent paid - money that's gone forever)

Total Invested

Initial investment:$218,500
Monthly contributions:$276,764
Total invested (in portfolio):$495,264

Total Costs Over Time

Total rent paid:$1,225,289
Total pure expenses:$1,225,289

Portfolio's Value After 20 Yrs

Initial investment:$218,500
Monthly contributions:$276,764
Investment returns:+$1,937,755
Final portfolio value:$2,433,019

Net Result Calculation

Final portfolio:$2,433,019
Minus rent paid:($1,225,289)
= Net Wealth (After 20 Yrs):+$1,207,730
Note: Initial investment and monthly contributions are not subtracted because they're already part of your portfolio

Renting + Investing has a better net result by $832,739

Net Result = What you get back minus what you put in over 20 years

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Helpful Resources to Get Started

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Important Disclaimer

This calculator provides general estimates for comparison purposes only. Default values and assumptions may be outdated or may not reflect your specific situation. Actual costs, returns, and outcomes will vary based on numerous factors including but not limited to: local market conditions, individual financial circumstances, tax laws, interest rate changes, and property-specific details.

This tool does not constitute financial, tax, legal, or investment advice. For personalized guidance on your specific situation, including tax savings calculations and deduction eligibility, please consult with qualified professionals such as a financial advisor, tax specialist, accountant, or real estate attorney.

Past performance and historical averages do not guarantee future results.