Rent versus buy questions, answered
The details behind a comparison that is often oversimplified.
Why compare net worth instead of monthly cost?
Part of a mortgage payment reduces debt and builds equity, while a renter may invest upfront cash and monthly savings. Net worth captures both effects; a payment-only comparison does not.
Does the calculator find a break-even year?
It compares the horizon you enter. Change the years-before-moving input to see when the modeled winner changes. A crossover is scenario-specific, not a universal rule.
Is the down payment treated as a cost?
No. It reduces the mortgage and becomes home equity. On the renting path, the same upfront cash—plus estimated buying costs—is invested.
Why include selling costs?
The comparison measures what could remain at the end of the chosen horizon. Brokerage, legal, transfer, and related costs reduce the equity available after a sale.
What should I use for maintenance?
Use a local estimate that fits the property’s age, condition, and included services. A percentage of value is a rough planning shortcut, not a repair schedule.
Does the model include tax deductions?
No. Mortgage-interest and property-tax treatment depends on jurisdiction and taxpayer circumstances. Investment taxes and home-sale tax rules are also excluded.
What about mortgage insurance or condo fees?
They are not separate inputs in this version. Add a conservative equivalent to monthly home insurance or maintenance for scenario testing, then confirm with a detailed local analysis.