Rent vs Buy Calculator
Should you rent or buy?
At year 7
Rent
Renting leaves you $57,994 wealthier than buying
“Cash spent” rows are nominal totals: dollars out minus dollars recovered, no time-value adjustment. The headline winner uses the discount rate to compound both sides, which is how it accounts for the opportunity cost of capital.
Renting ahead by
$57,994
at year 7, after sale
Break-even year
—
renting wins over horizon
Home equity at horizon
$278,599
paper equity (pre-sale)
Net sale proceeds
$231,249
after 7% selling costs
Opportunity portfolio
$198,715
$123,750 grown at 7%
Above the dashed line, buying is the better financial choice at that horizon. Below it, renting wins. The line factors in down payment + closing costs (year 0 disadvantage for buyers), annual carrying costs after the mortgage interest tax deduction (including PMI until it drops off, if you put less than 20% down), the 7% opportunity cost on the down payment, home appreciation, and selling costs at the assumed sale year.