Compare the estimated long-term cost of renting versus buying, see your break-even year, and understand what drives the decision.
Canada & USA · Break-even analysis · Equity vs. flexibility
Rent vs. Buy Details
Renting
Assumptions
Buying
20.0% of purchase price
Buying Appears Lower-Cost
Estimated Savings vs Renting
$178,129
over 10-year horizon
Understand what drives the decision.
Cost comparison
10yr
Buy saves
$178k
Buy net cost = total cash paid minus estimated equity. Select a horizon with the pills above.
Timeline
Break-even at Year 2 — based on these assumptions, buying becomes lower net-cost at this point.
FinCalc Smart AI Rent vs Buy Analysis
Decision Result
Buying Wins
Net buy cost is lower over this horizon
Based on these inputs, buying appears lower net-cost.
Over 10 years, estimated net buy cost of $124,517 compares favourably to total rent of $302,646, accounting for $485,914 in estimated equity. Results are sensitive to appreciation, rent growth, and ownership costs.
Home Appreciation Is Key
3.0%/yr
assumed annual appreciation
At 3.0% annual appreciation, estimated equity reaches $485,914 over 10 years. Appreciation is the dominant lever on net ownership cost in this scenario.
Estimate based on entered inputs. Actual results depend on market conditions.
Monthly Cost Check
Owning costs $1,722.34/mo more initially
Monthly ownership of $3,922.34 vs. rent of $2,200.00. The gap shrinks as rent increases.
Break-even Timeline
Break-even at Year 2
Based on these assumptions, buying becomes lower net-cost after approximately 2 years. Plans to sell or move before then shift the analysis toward renting.
Equity vs Flexibility
$485,914 estimated equity built
Buying builds an estimated $485,914 in equity over 10 years. The $130,000.00 down payment invested at 5.0% would grow by approximately $81,756 over the same period — not included in the cost comparison above.
10-Year Summary
Total Rent Cost
$302,646
Total Buy Net Cost
$124,517
Equity Built
$485,914
Break-even Year
Year 2
Estimates only. Results depend on home appreciation, rent growth, interest rates, and ownership costs — all uncertain. Not included: mortgage insurance (CMHC/PMI), capital gains tax, realtor commissions, property transfer tax, or province/state closing-cost precision. Does not constitute financial, mortgage, real estate, tax, or legal advice.
The calculator computes a net buy cost by summing all cash paid out and subtracting estimated equity:
Equity Built = Home Value at Horizon − Remaining Mortgage Balance. Home value grows annually at the assumed appreciation rate. The remaining balance decreases as monthly mortgage payments chip away at principal.
Monthly ownership = Principal & Interest + Property Tax + Insurance & Maintenance + Condo/HOA Fee. Principal & Interest is calculated using the standard amortization formula with Canadian semi-annual compounding or US monthly compounding depending on the active region.
Cumulative rent is computed year-by-year, growing at the annual rent increase rate entered. This models the compounding effect of rent inflation on total housing cost over the selected horizon.
The break-even year is the first year in which cumulative net buy cost falls below cumulative rent cost. Before break-even, renting is lower net-cost. After break-even, buying is lower net-cost (at these assumptions). If break-even is not reached within the selected horizon, renting remains cheaper throughout under the entered assumptions.
This calculator is for illustrative and informational purposes only. Results are estimates and may not reflect actual mortgage terms. Individual results will vary based on lender terms, credit profile, amortization period, and prevailing market conditions. This does not constitute financial, tax, or legal advice. Consult a licensed mortgage professional or qualified financial advisor before making any financial decisions.