Enrichment · Life Skills · Housing

Rent or buy?
It depends on when.

Buying costs a lot to get into and out of. Stay long enough and equity wins; leave early and renting often does. See the year the lines cross for your numbers.

Compare rent and buyWhat you get

The rent vs. buy decision calculator

The worked example compares $2,100 a month in rent with a $380,000 home over ten years. Nothing you type leaves this browser.

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What you get

Enrichment · Life SkillsFree

What you finish with
For each year: rent paid, owning costs, the owner’s equity if sold and the renter’s invested savings, which side is ahead, the year buying first pulls ahead, and the gap at the end. It prints as a one-page comparison.
Who it is for
Adults and families weighing a purchase against renting, young adults planning a first home, and students in a personal finance class.
Format
Browser calculator for a phone, tablet or computer, by touch or keyboard. Prints a summary; downloads a spreadsheet (.csv); export and import a file.
Access
Free. No account, no sign-in and nothing to install. Everything you type stays in this browser; nothing is sent to Caveat.
Where it lives
The Life Skills space in Caveat Enrichment.
Support
Questions, a correction or a request: team@caveatacademic.com.

How to use it

  1. Pick how long you will stay.
  2. Type the rent and the price.
  3. Add the loan and the costs.
  4. Set growth and return guesses.
  5. Find the year the lines cross.

Compare rent and buy

How the two sides are compared

Same starting cash, different uses, compared at the end of each year.

The worked example: $2,100 rent or a $380,000 home, ten yearsBuy up front$87,40020% down + 3% closingOwner after 10 years$217,221equity if soldRenter after 10 years$203,621savings invested at 5%Ahead$13,599buyingThe worked example: $2,100 rent or a $380,000 home, ten yearsBuy up front$87,40020% down + 3% closingOwner after 10 years$217,221equity if soldRenter after 10 years$203,621savings invested at 5%Ahead$13,599buying
Both sides start with the same cash. The owner turns it into a house and pays owning costs; the renter invests it, pays rent, and invests or draws on the difference each year. Compare what each has at the end.

The owner’s side

The owner pays the down payment and closing costs, then the mortgage, property tax, insurance, upkeep and dues each year. If the home were sold at the end of a year, the owner would keep its value less selling costs and the loan still owed.

The renter’s side

The renter keeps the down payment and closing costs invested. Each year, if owning would have cost more than renting, the renter invests the difference; if renting costs more, the renter draws on the savings. As a check with every rate at zero: a $100,000 home with $20,000 down against $500 rent, for one year, leaves the owner $22,667 of equity and the renter $16,667, so buying is ahead by $6,000, the year’s rent.

Sources

  1. Consumer Financial Protection Bureau. Owning a home: deciding whether to buy and what it costs (consumerfinance.gov/owning-a-home).
  2. U.S. Department of Housing and Urban Development. Renting versus buying a home (hud.gov).
  3. Internal Revenue Service. Publication 936 (Home Mortgage Interest Deduction) and Publication 523 (Selling Your Home) (irs.gov).
  4. Federal Housing Finance Agency. House Price Index, for local value growth history (fhfa.gov).

A comparison of money from guesses you type, not financial advice; rents, prices, rates and returns can all move differently. Taxes are left out. Your entries stay in this browser. Support: team@caveatacademic.com.