Rent vs Buy Calculator: Housing Costs and Invested Savings
Compare buying equity with a renter’s invested deposit and monthly savings. Adjust financing, rent growth, home appreciation, maintenance and transaction costs.
Your inputs
Your result
Enter your values, then choose Calculate.
Estimate based on your inputs. Fees, taxes and market changes are included only where explicitly entered.
Calculation breakdown
Method, assumptions and worked example
The comparison starts both households with the same money and monthly housing budget. The buyer spends down payment and closing costs. The renter invests that amount. Each month, whichever household has lower housing costs invests the difference at the chosen return.
What the ending result means
Buying net assets = future home value less selling costs and mortgage balance, plus invested monthly savings. Renting net assets = the renter’s investment balance. The headline is buying minus renting; positive favors buying within this specific model, negative favors renting.
Timing and assumptions
Mortgage payments follow monthly amortization and stop at payoff. Investment growth occurs before each month’s savings deposit. Home value changes monthly at the equivalent annual rate. Rent changes after each 12-month period. Property tax and maintenance track modeled home value; insurance and HOA stay constant. The home is assumed sold at the end.
A simple cross-check
With a 120,000 home, zero down, zero interest, a 120-month loan, rent of 1,000 and every other cost and growth rate set to zero, a one-year comparison gives the buyer 12,000 equity and the renter zero investments: buying minus renting is 12,000.
This model excludes tax deductions, capital-gains taxes, investment taxes, mortgage insurance, moving costs, rent deposits and changing insurance. Add relevant insurance costs to the owner insurance input where appropriate. It is a scenario comparison, not a recommendation; location, liquidity, uncertainty and flexibility also matter.
Frequently asked questions
Are the renter’s savings invested?
Yes. The initial down payment and buyer closing costs are invested by the renter. Each month, the cheaper housing scenario invests its cash-cost advantage.
Does the mortgage keep running after the loan term?
No. Loan payments and balance stop at payoff, while owner operating costs continue.
Sources and review
Formula and content reviewed on 9 October 2026. Examples are hypothetical. Tax years and model limits are stated above; this page does not receive live rates.