Method

The calculator runs month by month. Every step is listed here. Last reviewed November 11, 2026.

Payment. Loan = price × (1 − down %). Monthly payment uses the standard amortization formula for the rate and term.
Cash at closing. Down payment + closing costs (% of price). The renter is assumed to invest this amount instead.
Each month, owner cost = principal and interest + property tax (% of current value ÷ 12) + insurance ÷ 12 + HOA + maintenance (% of current value ÷ 12) + PMI.
PMI applies only when the down payment is under 20 percent, as % of the original loan per year, until the balance falls to 80 percent of the purchase price.
Renter cost = rent (raised once a year by the rent-increase rate) + renters insurance ÷ 12.
Invest the difference. Whichever side is cheaper that month invests the difference. Both portfolios grow monthly at the return you enter.
Net worth at each year end. Buyer = home value × (1 − selling %) − loan balance + buyer’s portfolio. Renter = renter’s portfolio.
Break-even year = the first year the buyer’s net worth is at least the renter’s.

What is left out

Income taxes, including the mortgage interest deduction and capital gains rules.
Refinancing, extra payments, and changes in rate after closing.
Moving costs and differences in utilities between the two homes.

Questions

Does the calculator include the mortgage interest deduction?

No. Tax effects depend on whether you itemize, your bracket, and current law. Leaving them out keeps the tool honest; ask a tax professional how they apply to you.

Does it predict home prices?

No. Home value growth is an input you choose. Try a low, middle, and high value to see the range.

If you want a person to talk through renting or buying where you live, talk to a real estate professional. The form is an inquiry only. This site does not name an agent or promise a call.