RENT VS. BUY WEALTH CALCULATOR

Current Monthly Rent

The base amount you currently pay your landlord each month to live in your home or apartment.

Annual Rent Increase

The percentage your rent goes up each year. Historically, rent increases average between 3% and 5% annually. This means your cost of living constantly rises while renting, whereas a fixed-rate mortgage locks in your primary housing cost for decades.

Monthly Renter's Insurance

A policy that covers your personal belongings and liability while renting. While generally inexpensive, it is still an out-of-pocket monthly expense that yields no financial return.

Timeframe to Compare

The number of years you plan to stay in your next home or continue renting. Real estate is a long-term wealth builder, so comparing 5, 10, or 30 years shows the true compounding power of homeownership and loan paydown.

Target Home Price

The estimated purchase price of the home you would like to buy instead of renting.

Estimated Home Appreciation

The percentage a home's value increases each year. Real estate historically appreciates over time, meaning your home becomes worth more while you live in it. A conservative, standard estimate is typically 3% to 5% per year.

Down Payment

The upfront cash paid toward the purchase of a home. While 20% is a common benchmark, many first-time homebuyer programs allow for as little as 3% to 5% down, and VA loans offer 0% down for eligible veterans.

DPA (Down Payment Assistance)

State, local, or lender programs designed to help buyers cover their down payment. Using a DPA program can significantly reduce the total out-of-pocket cash you need to bring to the closing table, making homeownership much more accessible.

Interest Rate

The cost of borrowing money for your mortgage. Locking in a fixed-rate mortgage guarantees your principal and interest payment will never go up, protecting you from inflation.

Total Rent Burned

The total amount of cash you will hand over to a landlord over your selected timeframe, factoring in your annual rent increases and renter's insurance. This is money you will never see again and builds zero wealth for your future.

Estimated Home Equity

The total net worth you build by owning a home over your selected timeframe. This is calculated by taking your home's new appreciated value and subtracting the remaining balance on your loan. This is wealth you can eventually cash out, borrow against, or pass on to your family.

Future Home Value

What your home is projected to be worth at the end of your selected timeframe, based on the estimated annual appreciation rate.

Remaining Loan Balance

The exact amount you still owe the bank after making your monthly mortgage payments over the selected timeframe. Every payment you make acts like a forced savings account, reducing this balance and increasing your equity.

Total Cash Needed to Close

The estimated out-of-pocket funds required to purchase the home.

Monthly Payment (P&I)

Your estimated monthly housing cost. This includes Principal and Interest. The Principal and Interest portion of a fixed-rate mortgage will never increase.