🏡 Rent vs Buy Calculator
Compare renting vs buying a home over any time horizon. See which path builds more wealth and exactly when buying breaks even.
Enter your values
- Buy path net worth€185,296.75
- Rent path net worth€181,769.68
- Net worth difference€3,527.06
What this means
- Buying breaks even in year 10 — after that the buy path leads in net worth.
- Buying ends ahead by €3,527.06 at the end of the horizon.
- Buy path final net worth: €185,296.75.
- Rent path final net worth (portfolio): €181,769.68.
Visual results
Detailed breakdown
| Year | Buy path | Rent path |
|---|---|---|
| 1 | €54,118.18 | €79,420.58 |
| 2 | €66,678.40 | €90,036.79 |
| 3 | €79,697.87 | €100,846.06 |
| 4 | €93,194.50 | €111,845.10 |
| 5 | €107,186.98 | €123,029.88 |
| 6 | €121,694.73 | €134,395.56 |
| 7 | €136,738.02 | €145,936.37 |
| 8 | €152,337.96 | €157,645.58 |
| 9 | €168,516.56 | €169,515.40 |
| 10 | €185,296.75 | €181,769.68 |
About this calculator
Should you rent or buy?
The rent-vs-buy decision is one of the biggest financial choices most people face. It is not purely a lifestyle question — it is a wealth-building question. The outcome depends on your local market, how long you plan to stay, your investment discipline, and the financing terms you can access.
How the two paths build wealth
Buying builds equity two ways: principal repayment (your mortgage payment reduces the balance you owe) and home appreciation (the property grows in value over time). At the end, you own an asset you can sell — but you must subtract selling costs to find your real net position.
Renting leaves your down payment and ongoing savings free to invest. If renting is cheaper than owning month-to-month, the difference can compound in a portfolio. The renter’s wealth is financial — a stock or fund portfolio — rather than a physical property.
Why buying often takes years to pull ahead
Transaction costs are the biggest drag on buying early. Purchasing typically costs 2–5% (legal fees, taxes, agent fees); selling costs another 5–7%. On a €300,000 home, that is €21,000–36,000 before you turn a profit. A renter who invests that money earns returns from day one. Buying only pulls ahead once appreciation and principal accumulation overcome that initial gap — which in most markets takes 5–10 years.
Key variables that shift the result
- Mortgage rate: a 1% difference changes monthly costs significantly on a large loan.
- Home appreciation: slow-growth markets (1–2%/yr) favor renting; fast-growth markets (4–5%/yr) favor buying.
- Investment return: if renter portfolio returns exceed home appreciation, renting compounds faster.
- Rent growth: rapidly rising rents erode the renter’s cash-flow advantage over time.
- Time horizon: the longer you stay, the more transaction costs are amortized and buying tends to win.
Frequently asked questions
How does this calculator compare renting and buying?
The calculator runs two parallel monthly simulations over your chosen time horizon. The buy path tracks home equity (home value minus remaining mortgage) minus the cost of selling. The rent path tracks a portfolio that starts with the down payment and buying costs, then grows at the investment return rate — and receives any monthly savings when renting is cheaper than owning. Net worth at each point determines which path is ahead.
What does the break-even year mean?
The break-even year is the first year in which the buy path's net worth exceeds the rent path's net worth. Before that point, the renter's invested portfolio is worth more. After that point, the homeowner's equity (after selling costs) pulls ahead. If buying never catches up within the horizon, the result shows 'renting wins for the entire period'.
Why do selling costs matter so much early on?
Selling costs (typically 5–7% of home value) are deducted from equity whenever you'd hypothetically sell. This creates a large initial drag on the buy path — you immediately 'lose' thousands of euros in transaction costs. The longer you stay in the home, the more appreciation and equity accumulation offset this. This is why short holding periods almost always favor renting.