CalcNest
Rent vs Buy Calculator
Compare which choice leaves you with more total wealth after the years you actually plan to stay, not just which costs less this month.
Your wealth outcome
These are end-of-period net positions after modeled costs, mortgage balance and selling costs.
Net position if buying
Net position if renting and investing
Wealth over time
Year-by-year figures
| Year | Home value | Mortgage left | Buy | Rent | Difference |
|---|
Plain-English explanation
Renting usually costs less up front and buying usually builds more long-term wealth, but the answer depends on your time horizon, rent growth, property costs and what you would do with the money instead.
How Does a Rent vs Buy Calculator Work?
It compares a buying scenario with a renting scenario month by month. Buying includes the mortgage and ownership costs. Renting keeps the down payment invested and invests monthly savings.
What Is the Break-Even Point?
The break-even year is when the buying net position first exceeds the renting net position after the modeled costs.
Frequently Asked Questions
Is renting cheaper than buying?
Usually in the short term. Buying carries large upfront costs, so renting tends to cost less in the first few years. Over longer periods, rising rent and growing home equity can flip that, which is exactly what the break-even year in your results is measuring.
What if I invest my down payment instead?
The renting scenario already models this. It seeds an investment fund with the money you would have put down, grows it at the return rate you enter, and tops it up every month that renting costs less than owning would.
What is the break-even point?
It's the year your net position from buying first overtakes your net position from renting and investing. Before that year, the numbers say you're ahead by renting. After it, buying is estimated to leave you with more.
How long should I stay before buying makes sense?
Long enough to clear your break-even year, and usually a bit longer than that as a buffer. Buying costs (stamp duty or the equivalent, legal fees, moving costs) are paid once, at the start, so the longer you stay, the more those costs get spread out and the less they weigh against you.
How much does home appreciation change the answer?
A great deal. It's one of the biggest single levers in this calculator. Try the same numbers at 1 percentage point higher and lower and watch how far the break-even year and the final net position move. If the answer only holds up at an optimistic appreciation rate, treat it as fragile.
What about stamp duty or land transfer tax?
It's included automatically based on the country you select, and shown as its own line in your results rather than folded silently into other costs. The rate used is a simplified, illustrative figure for that country, not the exact banded rules a real purchase would use, so check your own country's current thresholds before relying on it.
What happens to capital gains tax when I sell?
This calculator does not model capital gains tax on the sale. Many countries exempt a primary residence from it entirely, but rules vary and change, and a second property or investment property is often treated differently. Check your own country's current rules if this applies to you.
What hidden costs of owning does this include?
Property tax, insurance, HOA or service charges, maintenance, and the upfront country tax are all included in the ownership cost, not just the mortgage payment. That's deliberate: the mortgage payment alone understates what owning actually costs every month.
Is this financial advice?
No. It is an educational estimate. Check current local tax rules and speak to a qualified adviser.
More CalcNest Mortgage Tools
Once you have a purchase price in mind, check what it would actually cost with the CalcNest Mortgage Calculator, or see what you could realistically afford with the CalcNest Mortgage Affordability Calculator. If you already own and are comparing your options, the CalcNest Home Equity Calculator shows what you could access, and the CalcNest Mortgage Overpayment Calculator shows how much faster extra payments could build your equity. For a plain walkthrough of the maths behind overpaying a mortgage, see this guide to calculating mortgage overpayments and what they save you.
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