Tool
Rent or buy?
Compare how much it costs to rent against buying the same home over the years you plan to stay, factoring in appreciation, maintenance and the cost of the loan.
Result
—
Net cost difference over your horizon
Total cost of renting—
Cash outlays for buying—
Equity built (appreciation + principal)—
Net cost of buying—
Assumptions & method
- Renting: sum of rents with an annual increase, over the horizon.
- Buying: down payment + closing costs (6% assumed) + monthly payments + maintenance/property tax, minus the equity you build (home appreciation + principal paid down on the loan).
- Does not consider: selling costs on exit (~4–6% commission), the alternative return on an invested down payment, or the tax deduction of mortgage interest. It's a simplified comparison.
- All percentages are editable examples; the result is sensitive to the assumed appreciation —try it on the low side—.
FAQ
The essentials, in brief
Why does renting sometimes win?
Because when you buy you tie up your down payment and closing costs, and in the first years of the loan almost all of your payment is interest. If you only stay a few years, those fixed costs don't have time to be offset by appreciation and principal paydown.
How much does appreciation weigh on the result?
Enormously: it's the most uncertain variable. Try the scenario with 0% appreciation to see whether buying holds up without the property gaining value; if it only wins with high appreciation, you're speculating, not saving.
Does it include what I'd earn by investing the down payment if I rent?
No, to keep it simple. If you're a disciplined investor, mentally add it in favor of renting; you can estimate it with the investment-plan calculator.
Next step
Tell us about your deal
Tell us how much you need and what collateral you offer. We'll tell you frankly whether it's viable and how we'd structure it.
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