Interactive Tool
Rent vs. Buy Calculator
Adjust the variables below to match your situation. The calculator models two parallel paths (buying a home vs. renting and investing the difference) and shows you which strategy builds more wealth over time.
Home Purchase
Rent & Invest
The Verdict
Renting Wins
by $745,987
after 30 years
Buyer Net Worth
$1,140,813
Equity after selling costs
Renter Net Worth
$1,886,800
Investment portfolio
WinnerMonthly Mortgage
$2,398
Down Payment
$100,000
Break Even
Never
Buying Costs
$10,000
Selling Costs
$72,818
Final Home Value
$1,213,631
Net Worth Over Time
Comparing home equity vs. investment portfolio
Milestone Comparison
Net worth at key intervals
| Year | Buyer Net Worth | Renter Net Worth | Diff | Winner |
|---|---|---|---|---|
| 5 | $172,641 | $227,538 | $54,897 | Rent |
| 10 | $296,898 | $399,165 | $102,267 | Rent |
| 15 | $448,049 | $626,432 | $178,383 | Rent |
| 20 | $632,858 | $929,597 | $296,739 | Rent |
| 25 | $860,027 | $1,336,728 | $476,701 | Rent |
| 30 | $1,140,813 | $1,886,800 | $745,987 | Rent |
Methodology & Assumptions
Buyer path: Down payment buys the home. Monthly mortgage is calculated using standard amortization (PMT formula). Annual costs include property tax, insurance, and maintenance as a percentage of current home value, plus fixed HOA costs. Home value appreciates annually at the specified rate.
Renter path: The down payment amount is invested immediately (minus security deposit and upfront costs). Each year, the model calculates total homeownership costs minus rent. The difference (positive or negative) is added to the investment portfolio. The portfolio grows at the specified annual return rate.
Included: Buying and selling closing costs, property tax inflation, cost inflation, renter's insurance, and security deposits. Not modeled: Tax implications on either side (mortgage interest deduction for buyers, capital gains taxes on home sale or investment returns for renters), PMI for low down payments, and emotional/lifestyle value of homeownership.