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Real estate & rental

Real Estate Rent vs Buy Calculator

How long you need to stay before buying beats renting, counting the costs people forget.

Your numbers

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Taxes, insurance, maintenance.
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Result

Buying pulls ahead in 5.0 Years
Net cost of buying $185,957
Net cost of renting $224,047
Difference over the period $38,090
Equity at the end $175,098
Buying pulls ahead in about year 5.0. Over 7 years it costs $185,957 net against $224,047 in rent, a difference of $38,090.

An arithmetic tool, not financial or legal advice. Lending criteria, tax treatment and tenancy law all vary by state and change regularly. Confirm anything that affects a decision with a lender, an accountant or an attorney. The result swings enormously on two guesses nobody can make reliably: appreciation and rent inflation. It also ignores what the down payment would have earned if invested instead, which in a strong market can exceed the housing gain. Run it with appreciation at zero to see the honest floor.

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Questions

About this calculator

Why does buying take years to win?

Transaction costs. Between purchase costs and 6% to 8% selling costs, a house has to appreciate several percent just to break even on the round trip.

What about the money not spent on a down payment?

A real omission here. Invested elsewhere it earns a return, and a thorough comparison includes that opportunity cost. Treat this as a housing-cost comparison rather than a full investment analysis.

The formula

net cost of buying = payments and costs paid, less the equity recovered after selling costs

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