Rent or Buy Calculator

The rent or buy calculator answers the eternal question: is it cheaper to rent or to take out a mortgage. Enter the property price, the mortgage parameters and the current rent — the calculator compares two strategies in money: the buyer’s equity (property value minus the remaining loan) and the renter’s savings (the down payment plus the monthly gap between the mortgage payment and the rent, invested on a deposit). The result is a verdict with the amount of the advantage and a chart showing when buying starts to beat renting. All calculations run on your device.

How to use the calculator

Fill in four groups of numbers. Buying: the property price, the down payment in percent, the mortgage rate and the term. Renting: the monthly rent for the home you would rent and the expected rent growth. Forecasts: annual property price growth and the deposit rate at which the renter will save. Horizon: how many years ahead we compare. The result appears instantly: a verdict with the advantage in money, each side’s capital and a chart year by year.

How the comparison works

The buyer’s capital accumulates in the property: its value grows by the given percent each year while the debt shrinks on an annuity schedule. Equity = property value − remaining debt. The renter has two sources: the down payment, which was never spent and sits on a deposit, and the monthly difference between the mortgage payment and the rent — it also goes to the deposit and compounds. Meanwhile the rent itself grows by the given percent each year. At the horizon we compare the two final amounts.

When buying wins and when renting wins

Buying usually wins on a long horizon: the debt tends to zero and property has historically appreciated. Renting wins when the mortgage rate is high (the payment far exceeds the rent, and the gap compounds nicely on a deposit), when property is expensive relative to rent, or on a short horizon — in the first years the buyer pays mostly interest to the bank. Switch the deposit rate from 4% to 8% and watch renting catch up with buying.

What the result depends on

Five levers. The rent-to-price ratio: with a rent of 1,750 $ and a price of 350,000 $, rent “pays back” the property in about 17 years — below that norm renting is more attractive. Rates: a high mortgage rate hurts the buyer, a high deposit rate helps the renter. Property growth: an extra 2% of growth over 20 years makes a six-figure difference. Rent growth: indexation erodes the renter’s advantage. Down payment: the bigger it is, the smaller the debt and the payment.

Model limitations

The calculation is simplified and does not account for: taxes and fees when buying, renovation and maintenance costs (usually 1–2% of the property value per year), property tax, commissions, the renter’s moving costs and the difference in insurance. The model also assumes steady rates and steady growth — in reality they fluctuate. The calculator gives a reference point for comparing strategies, not an exact financial forecast.

The calculation is for information only and is not individual investment advice.