How this calculator works
For renting, it totals your rent over the horizon, rising each year at your assumed growth rate. For buying, it totals everything paid out — deposit, one-off buying costs, mortgage payments, and upkeep — then subtracts what you'd own at the end: the home's projected value minus the remaining mortgage. That net cost of buying is what makes the comparison fair, because a big slice of a mortgage payment isn't spent, it's stored.
The model is deliberately simplified, and you should know what it leaves out: selling costs if you move, rate changes on the mortgage, tax effects (which vary wildly by country), and the returns you might have earned investing the deposit instead. The assumptions it does use are all visible as inputs, so you can stress-test each one.
Common questions
Is renting really throwing money away?
No. Rent buys housing plus flexibility, and zero exposure to repairs, price falls, and transaction costs. Buying is often better over long stays because payments build equity, but interest, upkeep, and fees are money gone either way. The comparison is about which set of costs suits your plans.
What home price growth should I assume?
Be modest — over long periods house prices in many countries have roughly tracked or slightly beaten inflation, with big swings on the way. Try 2–4%, and look at how much the verdict changes: if the answer only favours buying at high growth assumptions, that's fragility worth knowing about.
Why does the calculator subtract equity from buying's cost?
Because part of each mortgage payment repays the loan rather than paying for housing, and the home itself may gain value. Ignoring that would overstate the cost of buying; counting it gives the net figure that's actually comparable to rent.
What does the model leave out?
Selling costs, mortgage rate changes, taxes and subsidies (which differ hugely by country), and the investment return your deposit could earn elsewhere. If the two options come out close, those factors — and your need for flexibility — should decide it.
This tool is educational and not financial advice. Housing costs, taxes, and market behaviour vary by country; the output is a structured comparison, not a prediction.
- 1.Buying a house: tools and resources — US Consumer Financial Protection Bureau