Buy vs Rent 5-Year Cost Comparison
Deciding whether to buy or rent involves more than comparing a mortgage payment to rent. Buying includes mortgage interest, property taxes, HOA fees, and the opportunity cost of tying up your down payment. Renting means paying rent but keeping your down payment invested where it earns returns.
This calculator computes the net 5-year cost for each option. For buying, it sums interest, opportunity cost on the down payment, property taxes, and maintenance. For renting, it subtracts the investment return on your saved down payment from total rent paid. Home price appreciation is excluded since it is speculative.
Frequently Asked Questions
When renting, you keep your down payment invested. The interest earned on that money partially offsets your rent cost, making renting more competitive than it first appears.
This calculator focuses on cash costs only. Home values can rise or fall unpredictably. Weigh potential appreciation separately based on your local market outlook.