Rent vs Buy Calculator
A rent vs buy calculator compares the total cost of renting versus buying a home over time. The decision depends on how long you stay, local market conditions, and opportunity cost of your down payment.
Key Factors in the Decision
| Factor | Favors Renting | Favors Buying |
|---|---|---|
| Time Horizon | Less than 3-5 years | More than 5-7 years |
| Down Payment | Can invest elsewhere | Real estate appreciation |
| Mobility | Job requires relocation | Stable career/location |
| Market | High price-to-rent ratio | Low price-to-rent ratio |
| Maintenance | Landlord handles | Build sweat equity |
Break-Even Analysis Example
$300,000 home vs $2,000/month rent:
| Cost Component | Buy (Monthly) | Rent (Monthly) |
|---|---|---|
| Principal + Interest | $1,896 | - |
| Property Tax | $313 | - |
| Insurance | $100 | $15 (renter's) |
| Maintenance | $250 | - |
| PMI (if applicable) | $150 | - |
| Rent | - | $2,000 |
| Total | $2,709 | $2,015 |
Rent vs Buy Calculator Implementation
``javascript
function rentVsBuy(homePrice, downPayment, rate, years, rent, rentIncrease, appreciation) {
const loan = homePrice - downPayment;
const monthlyRate = rate / 100 / 12;
const payments = 30 * 12;
const mortgage = loan * monthlyRate / (1 - Math.pow(1 + monthlyRate, -payments));
let buyingCost = downPayment;
let rentingCost = 0;
let monthlyRent = rent;
let homeValue = homePrice;
for (let year = 0; year < years; year++) {
buyingCost += (mortgage + homePrice * 0.015 / 12) * 12; // mortgage + taxes/insurance/maintenance
rentingCost += monthlyRent * 12;
monthlyRent *= (1 + rentIncrease / 100);
homeValue *= (1 + appreciation / 100);
}
const equityGained = homeValue - loan * 0.9; // simplified remaining loan
const netBuyingCost = buyingCost - equityGained;
return { buyingCost, rentingCost, netBuyingCost, homeValue };
}
console.log(rentVsBuy(300000, 60000, 7, 10, 2000, 3, 3));
``
The true answer depends on investment returns, appreciation, and your personal circumstances. Run the numbers for your specific situation.