Buy Vs Rent Calculator Online

Last updated on by Editorial Staff
Buy or Rent Calculator

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Guide to Use the Buy vs Rent Calculator

Our "Buy or Rent Calculator" is designed to help you make an informed decision between buying and renting a home. Simply fill in the relevant fields:

  • Currency: Choose the currency for your financial calculations.
  • Cost of House: Enter the total cost of the house you are considering.
  • Down Payment: Input the amount you can pay upfront.
  • Housing Loan Interest Rate (%): Provide the annual interest rate of your mortgage.
  • Loan Tenure (years): State the duration over which you intend to repay the loan.
  • Monthly Rent: Enter the amount you would pay monthly if renting.
  • Annual Rent Hike (%): Estimate the yearly percentage increase in rent.

Once all fields are filled, click on the "Calculate" button to see a detailed comparison of the total costs and a breakdown of payments over time. Use the "Reset" button to clear all fields and input new data.


Mortgage payment calculation (Buying)

The monthly mortgage payment is calculated using the formula for an annuity, which is the standard formula used to determine fixed periodic payments required to pay off a loan at a certain interest rate over a specific period

The formula for a monthly mortgage payment

buy vs rent calculator


  • P is the monthly payment
  • L is the loan amount (house cost minus down payment)
  • r is the monthly interest rate (annual interest rate divided by 12)
  • n is the total number of payments (loan tenure in years multiplied by 12)

Rent calculation (renting)

The total rent over the loan tenure is calculated by summing up the rent for each month, considering an annual rent increase.

The formula for total rent over the loan tenure

The monthly rent is updated each year by multiplying it by 1 + annual rent hike rate, and the updated rent is applied each month until the next increase

Formula of rent


Ri is the rent for the month i, which increases annually by the rent hike percentage

Who Can Use This Calculator

This calculator is ideal for:

  • First-time Home Buyers: Understand the long-term financial impact of buying vs renting.
  • Real Estate Investors: Analyze potential returns from different properties.
  • Relocators: Decide whether to rent or buy in a new city or country.
  • Financial Advisors: Provide clients with detailed cost analyses.

Where It Is Useful

  • Real Estate Blogs: Enhance content with interactive tools.
  • Personal Finance Websites: Help users with financial planning.
  • Housing Market Analysis: Compare costs in different markets.


How accurate is the Buy or Rent Calculator?

The calculator provides estimates based on the inputs you provide. Actual costs can vary due to factors like changes in interest rates, property taxes, or rent control laws.

Should I consider other expenses when buying a home?

Yes, consider property taxes, maintenance, insurance, and possible homeowners association (HOA) fees, which are not included in this calculator.

Can I use this calculator for any location?

Yes, the calculator is versatile and can be used for different markets, as long as you input accurate and location-specific data.

What if I plan to rent for less than the duration of the loan term?

Adjust the loan tenure field to match the duration of your intended rental period for a more accurate comparison.


Whether you're buying your first home, considering an investment property, or simply weighing financial options, our "Buy or Rent Calculator" is a valuable tool to guide your decision.

A clear financial comparison helps demystify the costs associated with buying versus renting, ensuring you make the best choice based on your circumstances and financial goals.

Use this tool as part of your broader financial planning strategy to navigate the complexities of the real estate market with confidence.