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Rent vs. Buy Calculator
Should you rent or buy? Compare the total cost of renting versus buying a home over your expected time horizon, including appreciation, rent increases, and tax benefits.
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How This Calculator Works
This calculator compares the total cost of renting (with annual increases) against the full cost of buying (mortgage payments, closing costs, taxes, insurance, maintenance) minus the equity you build through payments and appreciation.
Formula: Total Rent = Sum of monthly rents × (1 + annual increase)^year. Total Buy = Mortgage Payments + Closing Costs + Selling Costs + Maintenance + Taxes + Insurance – Equity Built.
Assumptions & Limitations
- • Buying costs include 3% closing costs, 6% selling costs, 1% annual maintenance, 1.2% property tax, $1,200/year insurance.
- • Appreciation and rent increases are consistent each year.
- • Does not account for investment returns on the down payment if you rented instead.
- • 30-year fixed-rate mortgage assumed.