★ MONEY · HOUSING · COMPARISONS
Buying wins by $76,892.03 over 10 years at the defaults: the $400,000 home costs $170,727.76 net to own against $247,619.79 of rent. The mortgage is $2,022.62 a month, and in year 1 owning costs $2,872.62 a month against $1,800.00 of rent — but equity does the heavy lifting. Change the rent, the rate, or the appreciation and the verdict can flip: at 0% appreciation, renting wins by $48,377.93.
A $400,000 home, 20% down, 6.50% for 30 years: P&I $2,022.62 a month. Over 10 years you pay $242,714.40 of mortgage payments, build $266,282.95 of equity, and end $76,892.03 ahead of renting. The calculator below runs your numbers at any price, rate, rent, or horizon.
Owning looks more expensive month to month and cheaper over a decade, because part of what you pay is not a cost at all — it is equity. The mortgage payment is $2,022.62 a month, but $48,716.40 of what you pay over 10 years is principal: money that comes back to you as equity when you sell. Rent is different: every dollar is gone. So the honest comparison is not the monthly payment against the rent. It is the net cost of owning — everything you pay, minus the equity you end up with — against the total rent over the same years.
At the defaults the monthly picture favours renting and the 10-year picture favours buying. In year 1, owning costs $2,872.62 a month: P&I $2,022.62, plus property tax $366.67 (1.10% of $400,000.00 a year, divided by 12), plus insurance $150.00, plus maintenance $333.33 (1.00% of $400,000.00 a year, divided by 12). Rent is $1,800.00 a month. So owning costs $1,072.62 more a month in year 1 — and still wins over 10 years, because the home gains $137,566.55 of value and the mortgage balance falls by $48,716.40.
Setup: home $400,000.00; down payment 20%, $80,000.00; loan $320,000.00; rate 6.50%, 30 years; tax 1.10% a year; insurance $150.00 a month; maintenance 1.00% a year; rent $1,800.00 a month; rent growth 3.00% a year; appreciation 3.00% a year; 10 years.
Line 1 — the loan. $400,000.00 × 80% = $320,000.00 borrowed; $80,000.00 paid up front.
Line 2 — the monthly rate. 6.50% / 12 = 0.541667% a month.
Line 3 — P&I. $320,000.00 × 0.00541667 × (1.00541667)^360 / ((1.00541667)^360 − 1) = $2,022.62 a month.
Line 4 — year-1 owning cost. $2,022.62 + $366.67 + $150.00 + $333.33 = $2,872.62 a month, against rent of $1,800.00.
Line 5 — P&I total. $2,022.62 × 120 = $242,714.40 over 10 years.
Line 6 — balance, principal, interest. After 120 payments the balance is $271,283.60, so principal paid is $320,000.00 − $271,283.60 = $48,716.40 and interest is $193,997.73.
Line 7 — value and equity. $400,000.00 × 1.03^10 = $537,566.55; equity is $537,566.55 − $271,283.60 = $266,282.95.
Line 8 — tax, maintenance, insurance. Tax is $4,400.00 a year growing at 3.00%, which sums to $50,441.07; maintenance is $4,000.00 a year growing at 3.00%, which sums to $45,855.52; insurance is $150.00 × 120 = $18,000.00.
Line 9 — cash out. $80,000.00 + $242,714.12 + $50,441.07 + $18,000.00 + $45,855.52 = $437,010.71. The P&I in this line is the unrounded $242,714.12, not the $242,714.40 on line 5 — see the rounding note below; the two differ by 28 cents.
Line 10 — net cost of owning. $437,010.71 − $266,282.95 = $170,727.76.
Line 11 — rent total. $1,800.00 × 12 × (1 + 1.03 + … + 1.03^9) = $21,600.00 × 11.463879 = $247,619.79.
Line 12 — the verdict. $247,619.79 − $170,727.76 = $76,892.03 for buying over 10 years.
5 years: the home is worth $463,709.63 against a $299,555.13 balance, which is $164,154.50 of equity. Net cost is $90,799.30 against $114,677.33 of rent, so buying wins by $23,878.03. Even a 5-year stay comes out ahead at 3.00% appreciation — the home gains $63,709.63 while rent climbs every year.
20 years: the home is worth $722,444.49 against a $178,128.90 balance, which is $544,315.59 of equity. Net cost is $282,823.80 against $580,400.09 of rent, so buying wins by $297,576.29. Two decades of appreciation and a shrinking balance do the work.
30 years: the loan is paid off and the home is worth $970,904.99. Net cost is $290,870.87 against $1,027,628.98 of rent, so buying wins by $736,758.11. The mortgage ends; the rent never does.
Rent $2,400 a month: rent totals $330,159.72 over 10 years, so buying wins by $159,431.96. When rent is high, the case for buying barely needs making.
Rent $1,400 a month: rent totals $192,593.17 over 10 years, so buying wins by only $21,865.41. Cheap rent nearly closes the gap — at $1,241.06 a month the verdict flips entirely (see the reverse below).
Rate 7.50%: P&I rises to $2,237.49 a month, which is $214.87 more a month and $25,784.40 more over 10 years, yet buying still wins by $44,647.43. A higher rate shrinks the lead by about $32,000.00; it does not erase it.
Rent growth 5%: rent totals $271,682.48 over 10 years, so buying wins by $100,954.72. When rent rises fast, locking in a fixed mortgage payment pays off sooner.
Appreciation 5%: the home is worth $651,557.85 after 10 years, net cost falls to $66,094.17, and buying wins by $181,525.62. Two extra points of appreciation are worth more than $100,000.00 over the decade.
Year 1: cash out is $114,471.41 — $80,000.00 down, $24,271.41 of P&I, $4,400.00 of tax, $1,800.00 of insurance, $4,000.00 of maintenance — against $95,576.72 of equity, so net cost is $18,894.69 against $21,600.00 of rent. Buying is already ahead by $2,705.31 in year 1. That is the appreciation doing the work: the home gains $12,000.00 in year 1 alone.
Reverse — the tie rent: rent of $1,241.06 a month totals $170,727.76 over 10 years at 3.00% growth, exactly the net cost of owning. Rent below about $1,241 a month flips the 10-year verdict to renting; rent above it favours buying.
Take the appreciation away and the whole verdict reverses. The home is still worth $400,000.00 after 10 years, so equity is only $128,716.40 — the principal you paid, nothing more. Tax is $44,000.00 and maintenance is $40,000.00 (flat, because the value never grows), insurance is $18,000.00, and cash out is $424,714.12. Net cost is $295,997.73 against $247,619.79 of rent, so renting wins by $48,377.93. Buying is a bet on the home gaining value: without that gain, you are paying $437,010.71 over a decade for $128,716.40 of equity and a roof you could have rented for less. If you believe your local market will stay flat, rent. See the build vs buy home comparison for the same logic applied to a new build.
The defaults are a $400,000.00 home with 20% down, a 6.50% 30-year fixed mortgage, 1.10% property tax, $150.00 a month of insurance, 1.00% maintenance, $1,800.00 a month of rent, and 3.00% a year for both rent growth and appreciation, over 10 years. Tax and maintenance grow with the home’s value in this model, so they rise 3.00% a year; rent grows at a flat 3.00% a year; the mortgage payment never changes.
Rounding convention, stated plainly: money is rounded to cents and the monthly payment is rounded to $2,022.62. The P&I total shown, $242,714.40, is that rounded payment times 120 months. The cash-out total uses the unrounded payment, $242,714.12, so the two differ by 28 cents — the cash-out figure is the one the net cost is built from. Interest, $193,997.73, is also rounded from the unrounded schedule: the rounded subtraction $242,714.12 minus $48,716.40 gives $193,997.72, one cent less. All figures on this page are computed from the unrounded values and rounded only for display.
| Output | Formula | What it means |
|---|---|---|
| Monthly P&I | $320,000.00 × r(1+r)^360 / ((1+r)^360 − 1) | $2,022.62 a month, principal and interest. |
| P&I total, 10 yr | $2,022.62 × 120 | $242,714.40 of mortgage payments in a decade. |
| Interest paid | P&I total − principal | $193,997.73 of interest over 10 years. |
| Principal paid | $320,000.00 − balance | $48,716.40 of the loan paid off. |
| Balance after 10 yr | amortisation formula | $271,283.60 still owed after 120 payments. |
| Home value after 10 yr | $400,000.00 × 1.03^10 | $537,566.55 — up $137,566.55. |
| Equity after 10 yr | value − balance | $266,282.95 that comes back when you sell. |
| Property tax, 10 yr | Σ $4,400.00 × 1.03^y | $50,441.07 of tax over the decade. |
| Maintenance, 10 yr | Σ $4,000.00 × 1.03^y | $45,855.52 of upkeep over the decade. |
| Insurance, 10 yr | $150.00 × 120 | $18,000.00 of homeowners insurance. |
| Cash out, 10 yr | down + P&I + tax + insurance + maintenance | $437,010.71 out of pocket in 10 years. |
| Net cost of owning | cash out − equity | $170,727.76 — the true cost of owning. |
| Rent total, 10 yr | Σ $1,800.00 × 12 × 1.03^y | $247,619.79 of rent, all of it gone. |
| The verdict | rent total − net cost | $76,892.03 for buying over 10 years. |
| 5-year net vs rent | same math, 5 years | $90,799.30 vs $114,677.33 — buying wins. |
| 20-year net vs rent | same math, 20 years | $282,823.80 vs $580,400.09 — buying wins. |
| 30-year net vs rent | same math, 30 years | $290,870.87 vs $1,027,628.98 — buying wins. |
| Year-1 net vs rent | same math, 1 year | $18,894.69 vs $21,600.00 — buying ahead already. |
The math is exact for the numbers you enter: the mortgage payment is the standard amortisation formula; the balance is the standard balance formula; the value, tax, maintenance, and rent totals are geometric sums at the growth rates you enter; equity is value minus balance; net cost is cash out minus equity. But the inputs carry the assumptions, and this calculator leaves real costs out. It ignores closing costs when you buy and selling costs when you sell — both can run to thousands of dollars and both count against buying, especially on a short stay. It ignores the opportunity cost of the $80,000.00 down payment: that money could have been invested instead, and its returns would narrow buying’s lead. It ignores tax deductions, which can help owners who itemise, and it ignores renters insurance, which renters pay and owners do not. Tax and maintenance grow with the home’s value in this model, which is a simplification: tax rates change, and maintenance comes in lumps — a roof, a furnace — not a smooth 1.00% a year. Rent grows at a flat rate here; real rent jumps, stalls, and sometimes falls. And appreciation is the whole game: at 3.00% buying wins by $76,892.03, at 0% renting wins by $48,377.93, and at 5% buying wins by $181,525.62. No forecast is cited on this page because none is used: every figure is arithmetic on the numbers you enter, and the appreciation rate you type is your own forecast. For a year-by-year breakeven that includes closing costs and the investment return on your down payment, see the rent vs buy calculator.
Bright Side Kit. "Rent vs Buy Home Calculator: 10-Year Cost Compared" https://brightoolbox.com/rent-vs-buy-home/ Accessed October 24, 2026.Buying, by $76,892.03 at the defaults. The net cost of owning a $400,000.00 home for 10 years is $170,727.76 against $247,619.79 of rent. But the answer depends on appreciation: at 0% appreciation, renting wins by $48,377.93.
$2,872.62 a month to own in year 1, against $1,800.00 to rent. Owning is P&I $2,022.62 plus tax $366.67, insurance $150.00, and maintenance $333.33. Owning costs $1,072.62 more a month — and still wins over 10 years, because $266,282.95 of it comes back as equity.
$266,282.95. The home grows from $400,000.00 to $537,566.55 while the balance falls from $320,000.00 to $271,283.60. That equity is what turns a $437,010.71 cash outlay into a $170,727.76 net cost.
When the home does not gain value, or when rent is low. At 0% appreciation, renting wins by $48,377.93 over 10 years. At $1,400.00 a month rent, buying wins by only $21,865.41 — and below about $1,241 a month, renting wins outright.
About $1,241 a month. At $1,241.06 a month, 10 years of rent at 3.00% growth totals $170,727.76 — exactly the net cost of owning. Rent less than that and renting wins; rent more and buying wins.
It shrinks the lead, it does not erase it. At 7.50%, P&I rises to $2,237.49 a month, but buying still wins by $44,647.43 over 10 years. The rate would have to rise much further — or appreciation fall to zero — to flip the verdict.
At the defaults, buying is already ahead in year 1, by $2,705.31. Net cost is $18,894.69 against $21,600.00 of rent. That depends on 3.00% appreciation: the home gains $12,000.00 in year 1. Without appreciation, a short stay favours renting, because closing and selling costs — which this calculator leaves out — hit hardest in the first years.
Closing costs, selling costs, the opportunity cost of the $80,000.00 down payment, tax deductions, and renters insurance. Closing and selling costs count against buying, especially on short stays. The down payment could have been invested instead. Tax deductions can help owners who itemise. Add your own estimates for those to the net cost above before deciding.