Rent versus buy calculator
Equal starting resources. Equal monthly budgets. A visible ledger for investments, home equity, and every housing cash flow.
Work with your numbers
Starting figures are examples, not current market rates or personal advice. All monetary inputs are U.S. dollars. Inputs stay in this browser.
Renting has higher modeled ending wealth
$35,663Illustrative estimate from the inputs above. No taxes or investment outcomes are guaranteed.
- Buyer wealth after sale
- $136,332
- Renter wealth including returned deposit
- $171,994
This compares ending wealth, not only cash in the bank. Change appreciation, investment return, selling costs and holding period to stress-test the result.
Cash, investments and home equity are different thingsScroll horizontally on small screens.
| Equal-resource money trail | Buy | Rent |
|---|---|---|
| Equal starting resources | $92,000 | $92,000 |
| Initial purchase cash / rent deposit | $92,000 | $2,000 |
| Initial investment account | $0 | $90,000 |
| Total housing cash paid (including upfront) | $269,231 | $130,693 |
| Investment account at horizon | $0 | $169,994 |
| Home value | $463,710 | $0 |
| Minus selling costs | $27,823 | $0 |
| Minus remaining mortgage | $299,555 | $0 |
| Net sale proceeds / returned deposit | $136,332 | $2,000 |
| Ending wealth = account + proceeds / deposit | $136,332 | $171,994 |
Year-by-year cash and investment ledger
Accounts grow first; monthly savings are deposited at month-endScroll horizontally on small screens.
| Year | Buy outlay | Rent outlay | Buy invested | Rent invested | Buy growth | Rent growth | Buy account | Rent account |
|---|---|---|---|---|---|---|---|---|
| 1 | $34,926 | $24,240 | $0 | $10,686 | $0 | $4,742 | $0 | $105,428 |
| 2 | $35,180 | $24,967 | $0 | $10,213 | $0 | $5,503 | $0 | $121,144 |
| 3 | $35,440 | $25,716 | $0 | $9,723 | $0 | $6,278 | $0 | $137,145 |
| 4 | $35,706 | $26,488 | $0 | $9,218 | $0 | $7,066 | $0 | $153,429 |
| 5 | $35,979 | $27,282 | $0 | $8,697 | $0 | $7,868 | $0 | $169,994 |
Annual home value, debt and liquidation wealth
Every year assumes a sale at that date with the entered selling costsScroll horizontally on small screens.
| Year | Home value | Mortgage debt | Buy wealth | Rent wealth |
|---|---|---|---|---|
| 1 | $412,000 | $316,423 | $70,857 | $107,428 |
| 2 | $424,360 | $312,607 | $86,291 | $123,144 |
| 3 | $437,091 | $308,535 | $102,330 | $139,145 |
| 4 | $450,204 | $304,191 | $119,001 | $155,429 |
| 5 | $463,710 | $299,555 | $136,332 | $171,994 |
How the numbers reconcile
- Both sides start with the larger required upfront amount. The buyer spends down payment + purchase costs; the renter ties up a refundable deposit. Each invests the unused initial cash.
- Each month the shared budget equals the larger housing outlay. Both investment accounts grow first, then each side invests its actual remaining budget. The mortgage appears once in buyer outlay—not twice in renter savings.
- Buyer final wealth = investment account + home value − selling costs − remaining mortgage. Renter final wealth = investment account + returned deposit. Buyer equity can be negative; it is never clipped to zero.
A worked reference case
Home $120,000, down $24,000, 0% eight-year loan, property tax $2,400/year, rent $1,000/month, one year, all other costs and growth zero: buyer equity is $36,000. The renter has $24,000 initial cash + $2,400 of actual monthly savings = $26,400. Buying leads by $9,600.
Assumptions and limits
Illustrative scenarios, not predictions or recommendations. Mortgage rate fixed; PMI constant while debt exists. Expense and rent changes occur annually; home value compounds monthly. Deposit returned in full at the horizon. No income tax, capital-gains tax, deductions, utilities differences, moving costs, major renovation, transaction timing or investment volatility. Maintenance is spending, not guaranteed added value. Negative growth and shorter holding periods can reverse the result.
Source checked October 6, 2026: CFPB: home loan costs and choices. Sources inform the definitions; starting figures are illustrative inputs, not sourced market quotes.
Explore the other real estate calculators