Mortgage vs Renting Calculator
Lifetime cost of buying vs renting.
Compare the lifetime cost of buying with a mortgage versus renting over any time horizon by entering your monthly payments and years planned.
What this tool does
This calculator models the lifetime cost of buying versus renting by comparing total outflows across your chosen time horizon. It takes your monthly mortgage payment, monthly rent, and the number of years you plan to stay, then shows the cumulative cost of each path side by side. The result illustrates how payment amounts and duration interact to shape total lifetime housing expense. Monthly payment difference is the primary driver of the comparison. A typical scenario might compare a five-year horizon where mortgage and rent differ significantly, revealing which path costs more in pure cash terms over that period. The calculator focuses on direct payments only and does not factor in home equity accumulation, maintenance or repair costs, property taxes, insurance, or rent increases over time. For a more complete picture that includes these elements, a comprehensive rent-versus-buy analysis may be more suitable. This tool is for educational comparison of payment flows.
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Formula Used
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Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
1,300 monthly mortgage vs 1,500 monthly rent over 25 years: mortgage pays 390,000, rent pays 450,000 — a 60,000 lower total for the buying path in this example. Equity built in the property would widen that difference, though this calculator counts cash payments only.
A worked example
With the defaults: monthly mortgage of 1,300, monthly rent of 1,500, horizon of 25. The tool returns 60,000.00. You can adjust any input and the result updates as you type — no submit button, no reload. That's the real power here: seeing how sensitive the output is to one or two assumptions.
What moves the number most
The result responds to Monthly Mortgage, Monthly Rent, and Horizon. Two inputs usually tip the answer one way or the other. Flipping each value past a round threshold shows which input moves the result most.
The formula behind this
Cash flow comparison only. Ignores home equity built, maintenance costs, and rent increases. For full comparison use rent-vs-buy calculator with those factors. Everything the calculator does is shown in the formula box below, so you can check the math against your own spreadsheet if you want.
Why this matters
Housing is usually the largest line in a budget, and the monthly gap between renting and buying compounds over years into a large number. Seeing the cumulative total for each path — rather than just the monthly difference — makes the long-run scale of that choice concrete.
What this doesn't capture
This is a pure cash-payment comparison. It leaves out the equity a buyer builds, maintenance and repair costs, property taxes and insurance, rent rises over time, and the opportunity cost of a deposit. A fuller rent-versus-buy analysis folds those in; this figure is just the cumulative payment gap.
Over 25 years, the difference between a £1,500 monthly rent and a £1,300 monthly mortgage adds up to $60,000.00.
Inputs
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
This calculator computes the cumulative cash flow difference between renting and buying over a specified period. It takes the monthly mortgage payment, subtracts the monthly rent payment, multiplies the result by 12 to annualise, then multiplies by the number of years to produce a total gap. The calculation treats both payments as constant throughout the horizon and expresses the result as an absolute value, indicating which option carries a higher total outlay regardless of direction. The model makes several simplifying assumptions: mortgage and rent payments remain flat, no additional costs such as maintenance, property tax, or insurance are included, and rent does not increase. It does not account for home equity accumulation, property appreciation, transaction costs, or the time value of money. This represents a basic cash flow snapshot only and omits factors material to a full rent-versus-buy decision.
Frequently Asked Questions
Does this include equity build?
What about maintenance?
Rent increases?
Opportunity cost of deposit?
Why does it say 'Never'?
Include equity?
Does it handle rent increases?
What if I'm only comparing for 5 years?
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