MoneyBasisRent vs Buy Calculator
What it estimates
This calculator compares estimated long-term financial outcomes of renting versus buying using home price, mortgage rate, rent, appreciation and investment-return assumptions. It does not conclude that buying or renting is universally better.
How it calculates
Buyer net worth = home value − loan balance + owner portfolio; renter net worth = renter portfolio.
Both sides start with equal resources. The renter invests the down payment and closing costs; the buyer starts with down-payment equity. Each month whichever side spends less invests the difference. Appreciation, rent growth and investment returns are user-adjustable assumptions, not forecasts.
Inputs
Home price · Down payment · Interest rate · Monthly rent · Time horizon
Included / not modeled
Included
- Equal starting resources
- Housing cost and appreciation assumptions
- Investing monthly cost differences
Not modeled
- Selling costs
- Tax deductions
- Moving costs
Assumptions & limitations
- Closing costs are estimated at 3% of the home price as a planning default.
- Annual property tax is 1.2% of the original price, scaled with appreciation, as a planning default — not a sourced local tax rate.
- Insurance is 0.5% and maintenance is 1.0% of the original price, also scaled.
- The loan has your selected fixed term; payments stop at payoff. Returns use nominal annual rates divided by 12. Appreciation is effective annual growth.
- Selling costs, tax deductions and moving costs are not modeled.