Should You Buy or Rent?
Compare the true costs of homeownership vs renting, plus see your "rental backup" if you ever need to move.
Property Details
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%
Affects PMI/MIP & term. The 5/1 ARM is modeled at the fixed rate you enter below (rate adjustments are not projected).
%
Ongoing Costs
%
Annual rate as % of home value (US avg: ~1.1%)
$
~0.35% of home value typical
$
%
Annual % of home value (1-2% recommended)
Your Income
$
$
Rental Backup Analysis
What if you need to move? This calculates whether you could rent out this home and cover your costs - your "exit strategy."
%
8-10% typical, 0% if self-managing
Projections
%/yr
%/yr
%/yr
Extra Payments (Optional)
$
$
Monthly Payment Breakdown
Principal & Interest
$0
Property Tax
$0
Insurance
$0
PMI
$0
HOA
$0
Maintenance Reserve
$0
Total Monthly Cost
$0
Affordability Check
Housing as % of Income (DTI)
0%
Rating
DTI Guidelines:
<25% Excellent | 25-28% Good | 28-36% Fair | >36% At Risk
<25% Excellent | 25-28% Good | 28-36% Fair | >36% At Risk
If You Rent This Home Out
Gross Monthly Rent
$0
Less: Vacancy
$0
Less: Management
$0
Less: Maintenance (5%)
$0
Less: CapEx Reserve (5%)
$0
Net Operating Income
$0
Less: Mortgage + Tax + Insurance + HOA
$0
Monthly Cash Flow
$0
In appreciation markets, negative cash flow is common. The key is: can you cover the shortfall if needed? Make sure you can hold for 5+ years.
Note: when modeled as a rental, Maintenance and CapEx are each estimated at 5% of effective rent (standard landlord operating reserves). These are separate from the owner-occupant "Maintenance Reserve" used in the affordability and wealth tabs.
5-Year Wealth Comparison
| 🏠 BUY | 🏢 RENT | |
|---|---|---|
| Future Home Value | $0 | — |
| Less: Mortgage Balance | $0 | — |
| Home Equity | $0 | — |
| Invested Capital + Growth (down payment, closing & monthly rent-vs-own savings invested) | — | $0 + $0 |
| Less: Closing Costs (Buy) | $0 | — |
| Less: Selling Costs (6%) | $0 | — |
| Rent Paid (for reference — already reflected in the savings invested above, not netted again) | — | $0 |
| Net Wealth | $0 | $0 |
Extra Payment Impact
WITHOUT Extra Payments
Payoff: 30 years
Total Interest: $0
WITH Extra Payments
Payoff: 30 years
Total Interest: $0
You Save
$0
in interest + 0 saved
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