ConvertOnlineRent vs. Buy Calculator for Costs, Equity and Break-Even
Report source: https://convertonline.org/calculators/rent-vs-buy-calculator
Compare estimated net wealth from renting and buying over the same period. The model tracks home equity and invests whichever option has the lower monthly cash outflow.
Calculations run in your browser. Your financial inputs are not uploaded or stored.
Rent vs. Buy Calculator
Estimated rent or buy comparison
Detailed results
Swipe or scroll horizontally to see every column.
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How the rent vs. buy calculator works
Buyer wealth equals estimated sale proceeds after the mortgage and selling costs, plus invested monthly savings. Renter wealth equals invested upfront and monthly savings plus the refundable deposit.
Tax deductions are excluded because eligibility and benefit depend on itemization, income, loan use, filing details, limits, and current tax rules.
How to use this calculator
- Enter the purchase, mortgage, and starting rent.
- Review or change appreciation, rent growth, ownership costs, selling costs, and investment return.
- Compare annual net wealth, cash outlays, equity, and the first durable break-even year.
Assumptions and limitations
- The comparison uses the same starting cash and invests the monthly difference for whichever option costs less.
- Home value, rent, and investments change at constant entered rates; actual results vary.
- Tax deductions are excluded from the default model because their value is not universal.
Sources and further reading
Worked example
Example: equal monthly housing cash flow
A $120,000 home with $20,000 down and a 0% 10-year mortgage has an $833.33 payment. Compare it with $1,000 rent and no other costs or growth for one year.
The buyer gains principal and invests the monthly savings, finishing about $12,000 ahead in this simplified example.
Frequently asked questions
Why does the calculator invest the monthly difference?
Using the same starting cash and investing the cheaper option’s monthly savings makes the comparison balanced rather than assuming unused cash disappears.
Why are tax deductions excluded?
Mortgage-interest and property-tax benefits depend on itemization, eligibility, limits, filing details, and current law, so a universal tax-rate shortcut can overstate savings.
What does durable break-even mean?
It is the first year after which the option that is ahead remains ahead through the selected comparison horizon.
This calculator provides an estimate for planning and education. Actual lender calculations, rates, costs, taxes, insurance, market changes, and individual circumstances may differ.