Rent Vs Buy Cumulative Cost
Calculator
Results
- Buying advantage
- $130,904.83
- Net cost of buying
- $61,688.35
- Net cost of renting
- $192,593.17
- Home equity
- $263,382.20
- Property value
- $470,370.73
How the position develops over the projected years
- Cumulative cost of buying
- Cumulative cost of renting
Year-by-year property projection
| 1 | 104,342.23 | 16,800.00 | 360,500.00 | 86,273.34 | 18,068.89 |
| 2 | 128,310.45 | 34,104.00 | 371,315.00 | 103,157.05 | 25,153.40 |
| 3 | 152,408.46 | 51,927.12 | 382,454.45 | 120,675.70 | 31,732.75 |
| 4 | 176,640.13 | 70,284.93 | 393,928.08 | 138,854.91 | 37,785.22 |
| 5 | 201,009.50 | 89,193.48 | 405,745.93 | 157,721.40 | 43,288.10 |
| 6 | 225,520.67 | 108,669.29 | 417,918.30 | 177,303.04 | 48,217.63 |
| 7 | 250,177.92 | 128,729.36 | 430,455.85 | 197,628.93 | 52,548.99 |
| 8 | 274,985.61 | 149,391.25 | 443,369.53 | 218,729.40 | 56,256.21 |
| 9 | 299,948.27 | 170,672.98 | 456,670.61 | 240,636.15 | 59,312.13 |
| 10 | 325,070.55 | 192,593.17 | 470,370.73 | 263,382.20 | 61,688.35 |
Comparison
| Scenario | Net cost after the projection | Cumulative outlay |
|---|---|---|
| Doing nothing | 192,593.17 | 192,593.17 |
| Your scenario | 61,688.35 | 325,070.55 |
Formula
net buy = (deposit + fees + Σ payments + Σ costs) − (value − balance); net rent = Σ rent_y= 130904.83
Note
This is a simplified projection model. It compounds the growth, cost and return rates you enter at a constant annual rate and amortizes mortgages on a standard fixed-rate annuity; real property markets, rents, interest rates, vacancy, maintenance and running costs move irregularly and can fall as well as rise. Taxes are applied only as the flat rate and allowance you enter: stamp duty and other transfer taxes are usually banded, capital gains relief, principal-residence exemptions, rental-income tax, depreciation and allowable expenses vary by country and by your circumstances and are not modelled here. Transaction, legal, letting and selling costs are taken as the percentages you supply. Baseline comparisons hold the alternative flat and ignore what else the money might have done. These results are general information, not investment, mortgage, tax or legal advice: consult a qualified professional before committing to a property decision.
More in Property projections
See all →Frequently asked questions
What costs does the buying side actually include besides the mortgage payment?+
A realistic comparison includes property taxes, insurance, maintenance, closing costs, and often the opportunity cost of the down payment, not just principal and interest. Renting-side costs typically include rent increases over time and, sometimes, the opportunity cost of investing what would have been the down payment.
Why does buying often look worse in early years but better later?+
Upfront closing costs and the slow pace of equity buildup in early mortgage years (when most of the payment is interest) make buying expensive at first. As the mortgage balance shrinks and home equity grows, and if the property appreciates, the cumulative cost of buying can fall below renting over a long enough horizon.
What is the 'breakeven' point this kind of calculator usually shows?+
It's the number of years you'd need to stay in the home for the cumulative cost of buying (net of any home equity or appreciation) to become lower than the cumulative cost of renting. Staying shorter than that breakeven generally favors renting; staying longer favors buying.
Does the comparison assume home prices always go up?+
It depends on the appreciation rate you enter — using a flat or conservative rate is safer than assuming the strong appreciation of any particular recent period, since property values can also stagnate or decline over multi-year stretches.
Should I ignore this if I don't plan to stay long?+
No — that's exactly when this comparison matters most, since transaction costs (agent fees, closing costs, moving costs) make buying and quickly selling one of the most expensive ways to house yourself. A short expected stay is one of the strongest arguments for renting.