Rent vs Buy
Homebuying is often considered a core component of the American dream. From a financial perspective, owning can also be a financial burden. This tool helps you understand the short and long-term costs of the rent vs. buy decision. The methodology is comprehensive, taking into consideration the following factors:
- The upfront capital commitments to both rent and purchase a home.
- The ongoing costs associated with renting and owning a home.
- The costs of obtaining and paying down a mortgage.
- The potential tax benefits of a mortgage.
- The capital gain exemption when selling your primary residence.
- The opportunity cost of dedicating your dollars to paying rent or purchasing a home rather than investing those dollars in an investment portfolio.
The output illustrates the average monthly cost of both renting and buying over a series of 30 years. While this tool cannot incorporate every nuance or factor impacting your personal situation, it serves as a baseline comparison of your available choices, given the inputs you provide.