Mortgage vs Rent Calculator
Compare the monthly cost of buying a home (mortgage, taxes, insurance) versus renting.
See which option is more affordable over time.
Comparing mortgage to rent requires looking beyond the monthly payment — the true cost of homeownership includes interest, taxes, insurance, maintenance, and the opportunity cost of a down payment tied up in equity.
True Monthly Cost of Owning:
Monthly Ownership Cost = Mortgage Payment + Property Tax + Insurance + HOA + Maintenance − Tax Deduction Benefit − Equity Build Rate
True Monthly Cost of Renting:
Monthly Renting Cost = Monthly Rent + Renter’s Insurance − Investment Return on Down Payment (opportunity cost)
The Price-to-Rent Ratio:
P/R Ratio = Home Price / (Annual Rent)
- P/R < 15: Buying is likely better
- P/R 15–20: Neutral zone
- P/R > 20: Renting is likely better financially
Worked Example:
- Home price: $380,000
- 20% down ($76,000), mortgage $304,000 at 7%, 30 yr
- Monthly mortgage = $2,023
- Property tax (1.2%/yr): $380 /month
- Insurance: $120/month
- Maintenance (1%/yr): $317/month
- Total: $2,840/month
Equivalent apartment rent: $2,200/month
Down payment invested at 7%: $76,000 × 7% / 12 = $443/month opportunity cost
Adjusted renting cost: $2,200 + $443 = $2,643/month
Break-even analysis: Owning becomes cheaper after equity growth + appreciation outpace the rent savings. In appreciating markets (3–5%/yr), break-even typically occurs at 4–8 years. In flat markets it may exceed 12 years. Always include your expected tenure before buying.
How we build and check this calculator
This calculator runs entirely in your browser, so the numbers you enter stay on your device. The math behind it is written by hand and tested against worked examples and standard references before the page goes live.
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