Rent vs. Buy Calculator
| Amount | % of Combined | |
|---|---|---|
| Buying Net Worth | ₹0 | 0% |
| Renting Net Worth | ₹0 | 0% |
| Difference | ₹0 | - |
| Monthly Mortgage Payment (P&I) | ₹0 |
| Final Home Value | ₹0 |
| Total Rent Paid | ₹0 |
| Net Worth Advantage | ₹0 |
| Year | Home Equity (Buying) | Portfolio Value (Renting) | Difference |
|---|
What Is a Rent vs. Buy Calculator?
A Rent vs. Buy Calculator compares the long-term financial outcome of buying a home versus renting and investing the money you would have otherwise put toward a down payment and any extra housing costs.
How to Use This Calculator
- Home Price & Down Payment — the purchase price and the percentage you'd pay upfront if buying.
- Mortgage Rate & Loan Term — the terms of the home loan you'd take on.
- Tax + Insurance + Upkeep — an estimated annual percentage of home value for property tax, insurance, and maintenance.
- Home Appreciation — how much you expect the home's value to grow each year.
- Monthly Rent & Annual Rent Increase — your current rent and how much it typically rises each year.
- Investment Return — the return you could expect if you invested the down payment and any monthly savings from renting instead of buying.
- Comparison Period — how many years you want to project forward.
The calculator tracks two paths side by side: your home equity if you buy, and an investment portfolio if you rent and invest the difference every month. Whichever ends higher is the better outcome under the assumptions entered.
Frequently Asked Questions
How does a rent vs. buy calculator work?
It projects your net worth under each scenario: buying builds home equity as you pay down the mortgage and the home appreciates, while renting lets you invest the money you would have spent on a down payment and any monthly savings.
Is buying always better than renting long-term?
Not necessarily. It depends heavily on home price growth, mortgage rates, rent growth, and the investment return the renter could earn on the money not tied up in a home.
What costs are included for buying?
This calculator includes the mortgage principal and interest payment along with an estimated annual percentage for property tax, insurance, and maintenance.
What is the opportunity cost of a down payment?
It is the return that money could have earned if invested elsewhere instead of being used as a down payment on a home.