What your result means
Rent cost accumulates with annual increases. Buy cost includes the down payment, purchase costs, mortgage payments, taxes, insurance, and maintenance, then subtracts estimated net sale proceeds and remaining equity.
Formula and assumptions
Net buy cost = cash invested + ownership cash costs − net sale proceeds. Net sale proceeds = future home value − selling costs − remaining mortgage balance. Rent grows annually by the entered rate.
- The mortgage is a 30-year fixed loan.
- Home appreciation, rent growth, taxes, insurance, and maintenance follow simplified assumptions.
- Investment returns, tax deductions, utilities, deposits, and renter insurance are excluded.
Worked example
Compare $2,200 monthly rent with a $400,000 home, 10% down, a 6.5% mortgage, and a seven-year stay. Small changes in appreciation, selling cost, or move date can reverse the result.
Limitations
This is a scenario model, not a forecast. It omits transaction-specific taxes, investment opportunity cost, renovations, major repairs, tax effects, moving costs, and qualitative differences between renting and ownership.