{"success":true,"version":"v1","request":{"tool":"get_calculator_schema","calculator_id":"rent-vs-buy"},"result":{"entity_type":"calculator","id":"rent-vs-buy","calculator_id":"rent-vs-buy","canonical_url":"https://tttkmbb.com/finance/rent-vs-buy","name":"Rent vs. Buy Calculator","title":"Rent vs. Buy Calculator – Total Cost of Renting versus Owning over a Time Horizon","category":"finance","category_name":"Finance","tool_name":"compare_rent_vs_buy","featured_mcp_tool":false,"description":"Compares the net cost of renting with the net cost of buying a home over a chosen number of years: rent with annual increases versus mortgage payments, property tax, maintenance, transaction costs and the opportunity cost of the upfront cash, net of the equity recovered when the home is sold.","use_when":"You want a first-order comparison of renting against buying for a given horizon, rate, appreciation and investment-return assumption.","do_not_use_when":"You need tax deductions, rent-controlled scenarios or month-by-month cash-flow modelling; the model is annual and simplified. For the mortgage payment alone use mortgage-payment.","inputs":[{"name":"monthly_rent","label":"Monthly rent","type":"number","required":true,"max":1000000,"exclusive_min":0,"description":"Rent today for a comparable home.","example":2000},{"name":"rent_growth_percent","label":"Annual rent increase","type":"number","unit":"%/year","required":false,"default":3,"min":-10,"max":30,"description":"Yearly rent growth in percent.","example":3},{"name":"home_price","label":"Home price","type":"number","required":true,"max":10000000000,"exclusive_min":0,"description":"Purchase price of the home.","example":400000},{"name":"down_payment","label":"Down payment","type":"number","required":true,"min":0,"max":10000000000,"description":"Cash paid at purchase; the rest is financed.","example":80000},{"name":"annual_rate_percent","label":"Mortgage rate","type":"number","unit":"%","required":true,"min":0,"max":100,"description":"Fixed annual mortgage rate in percent.","example":6.5},{"name":"term_years","label":"Mortgage term","type":"number","unit":"years","required":false,"default":30,"max":50,"exclusive_min":0,"description":"Mortgage term in years.","example":30},{"name":"property_tax_percent","label":"Property tax","type":"number","unit":"% of value/year","required":false,"default":1.2,"min":0,"max":10,"description":"Annual property tax as a percent of the home's value that year.","example":1.2},{"name":"maintenance_percent","label":"Maintenance, insurance and HOA","type":"number","unit":"% of value/year","required":false,"default":1,"min":0,"max":10,"description":"Annual upkeep, insurance and association dues as a percent of the home's value that year.","example":1},{"name":"home_appreciation_percent","label":"Home appreciation","type":"number","unit":"%/year","required":false,"default":3,"min":-20,"max":30,"description":"Yearly growth of the home's value in percent.","example":3},{"name":"investment_return_percent","label":"Investment return","type":"number","unit":"%/year","required":false,"default":7,"min":-50,"max":50,"description":"Annual return the renter could earn on the down payment and closing costs instead.","example":7},{"name":"years","label":"Horizon","type":"integer","unit":"years","required":true,"min":1,"max":40,"description":"How many years you expect to stay before selling or moving.","example":10},{"name":"buying_closing_costs_percent","label":"Buying closing costs","type":"number","unit":"% of price","required":false,"default":3,"min":0,"max":15,"description":"One-off purchase costs (lender fees, title, transfer tax) as a percent of the price.","example":3},{"name":"selling_costs_percent","label":"Selling costs","type":"number","unit":"% of sale price","required":false,"default":6,"min":0,"max":15,"description":"Agent commission and other costs when selling, as a percent of the sale price.","example":6}],"outputs":[{"name":"total_cost_of_renting","label":"Total cost of renting","type":"number","decimals":2,"description":"Sum of rent over the horizon with annual increases."},{"name":"total_cost_of_buying","label":"Total cost of buying","type":"number","decimals":2,"description":"Upfront cash + mortgage payments + tax and maintenance + opportunity cost of upfront cash − net equity at sale."},{"name":"net_advantage_of_buying","label":"Net advantage of buying","type":"number","decimals":2,"description":"total_cost_of_renting − total_cost_of_buying (positive = buying is cheaper over the horizon)."},{"name":"better_option","label":"Cheaper option","type":"string","decimals":4,"description":"'Buying' or 'Renting' under these assumptions."},{"name":"monthly_principal_and_interest","label":"Mortgage payment (P&I)","type":"number","decimals":2,"description":"Level monthly payment on home_price − down_payment."},{"name":"total_mortgage_payments","label":"Mortgage payments over horizon","type":"number","decimals":2,"description":"P&I × months in the horizon (capped at the loan term)."},{"name":"total_property_tax_and_maintenance","label":"Tax and maintenance over horizon","type":"number","decimals":2,"description":"Σ home value at the start of each year × (property_tax_percent + maintenance_percent)/100."},{"name":"upfront_cash","label":"Upfront cash","type":"number","decimals":2,"description":"down_payment + buying closing costs."},{"name":"opportunity_cost_of_upfront_cash","label":"Opportunity cost of upfront cash","type":"number","decimals":2,"description":"upfront_cash × ((1 + investment_return)^years − 1): return the renter would have earned on that cash."},{"name":"home_value_at_end","label":"Home value at end","type":"number","decimals":2,"description":"home_price × (1 + appreciation)^years."},{"name":"loan_balance_at_end","label":"Loan balance at end","type":"number","decimals":2,"description":"Remaining mortgage principal after the horizon."},{"name":"net_equity_at_sale","label":"Net equity at sale","type":"number","decimals":2,"description":"home_value_at_end × (1 − selling_costs_percent/100) − loan_balance_at_end."},{"name":"average_monthly_cost_of_renting","label":"Average monthly cost of renting","type":"number","decimals":2,"description":"total_cost_of_renting / months."},{"name":"average_monthly_cost_of_buying","label":"Average monthly cost of buying","type":"number","decimals":2,"description":"total_cost_of_buying / months."}],"input_schema":{"type":"object","properties":{"monthly_rent":{"description":"Rent today for a comparable home.","type":"number","maximum":1000000,"exclusiveMinimum":0,"examples":[2000]},"rent_growth_percent":{"description":"Yearly rent growth in percent. Unit: %/year.","type":"number","minimum":-10,"maximum":30,"default":3,"examples":[3],"x-unit":"%/year"},"home_price":{"description":"Purchase price of the home.","type":"number","maximum":10000000000,"exclusiveMinimum":0,"examples":[400000]},"down_payment":{"description":"Cash paid at purchase; the rest is financed.","type":"number","minimum":0,"maximum":10000000000,"examples":[80000]},"annual_rate_percent":{"description":"Fixed annual mortgage rate in percent. Unit: %.","type":"number","minimum":0,"maximum":100,"examples":[6.5],"x-unit":"%"},"term_years":{"description":"Mortgage term in years. Unit: years.","type":"number","maximum":50,"exclusiveMinimum":0,"default":30,"examples":[30],"x-unit":"years"},"property_tax_percent":{"description":"Annual property tax as a percent of the home's value that year. Unit: % of value/year.","type":"number","minimum":0,"maximum":10,"default":1.2,"examples":[1.2],"x-unit":"% of value/year"},"maintenance_percent":{"description":"Annual upkeep, insurance and association dues as a percent of the home's value that year. Unit: % of value/year.","type":"number","minimum":0,"maximum":10,"default":1,"examples":[1],"x-unit":"% of value/year"},"home_appreciation_percent":{"description":"Yearly growth of the home's value in percent. Unit: %/year.","type":"number","minimum":-20,"maximum":30,"default":3,"examples":[3],"x-unit":"%/year"},"investment_return_percent":{"description":"Annual return the renter could earn on the down payment and closing costs instead. Unit: %/year.","type":"number","minimum":-50,"maximum":50,"default":7,"examples":[7],"x-unit":"%/year"},"years":{"description":"How many years you expect to stay before selling or moving. Unit: years.","type":"integer","minimum":1,"maximum":40,"examples":[10],"x-unit":"years"},"buying_closing_costs_percent":{"description":"One-off purchase costs (lender fees, title, transfer tax) as a percent of the price. Unit: % of price.","type":"number","minimum":0,"maximum":15,"default":3,"examples":[3],"x-unit":"% of price"},"selling_costs_percent":{"description":"Agent commission and other costs when selling, as a percent of the sale price. Unit: % of sale price.","type":"number","minimum":0,"maximum":15,"default":6,"examples":[6],"x-unit":"% of sale price"}},"additionalProperties":false,"required":["monthly_rent","home_price","down_payment","annual_rate_percent","years"]},"output_schema":{"type":"object","properties":{"total_cost_of_renting":{"description":"Sum of rent over the horizon with annual increases.","type":"number"},"total_cost_of_buying":{"description":"Upfront cash + mortgage payments + tax and maintenance + opportunity cost of upfront cash − net equity at sale.","type":"number"},"net_advantage_of_buying":{"description":"total_cost_of_renting − total_cost_of_buying (positive = buying is cheaper over the horizon).","type":"number"},"better_option":{"description":"'Buying' or 'Renting' under these assumptions.","type":"string"},"monthly_principal_and_interest":{"description":"Level monthly payment on home_price − down_payment.","type":"number"},"total_mortgage_payments":{"description":"P&I × months in the horizon (capped at the loan term).","type":"number"},"total_property_tax_and_maintenance":{"description":"Σ home value at the start of each year × (property_tax_percent + maintenance_percent)/100.","type":"number"},"upfront_cash":{"description":"down_payment + buying closing costs.","type":"number"},"opportunity_cost_of_upfront_cash":{"description":"upfront_cash × ((1 + investment_return)^years − 1): return the renter would have earned on that cash.","type":"number"},"home_value_at_end":{"description":"home_price × (1 + appreciation)^years.","type":"number"},"loan_balance_at_end":{"description":"Remaining mortgage principal after the horizon.","type":"number"},"net_equity_at_sale":{"description":"home_value_at_end × (1 − selling_costs_percent/100) − loan_balance_at_end.","type":"number"},"average_monthly_cost_of_renting":{"description":"total_cost_of_renting / months.","type":"number"},"average_monthly_cost_of_buying":{"description":"total_cost_of_buying / months.","type":"number"}}},"formula":"rent_total = Σ_{y=0}^{years−1} 12 × monthly_rent × (1 + g)^y. loan = home_price − down_payment; P&I from the annuity formula; value_y = home_price × (1 + a)^y; ownership_costs = Σ value_y × (tax% + maintenance%)/100; upfront = down_payment + closing% × home_price; opportunity = upfront × ((1 + r)^years − 1); equity = value_years × (1 − selling%) − balance_after(12 × years); buy_total = upfront + P&I × months + ownership_costs + opportunity − equity; advantage = rent_total − buy_total","method":"Annual model with costs based on the home value at the start of each year. It ignores income-tax effects (mortgage-interest deduction, capital-gains exclusion), renter's insurance, and the investment of any monthly cash-flow difference between the two options; only the upfront cash is treated as invested. Results are sensitive to the appreciation and return assumptions.","sources":[{"name":"CFPB – Owning a Home: loan costs and monthly payment components","url":"https://www.consumerfinance.gov/owning-a-home/","type":"government","retrieved_at":"2026-09-24"},{"name":"Wikipedia – Opportunity cost","url":"https://en.wikipedia.org/wiki/Opportunity_cost","type":"reference","retrieved_at":"2026-09-24"},{"name":"Wikipedia – Mortgage loan","url":"https://en.wikipedia.org/wiki/Mortgage_loan","type":"reference","retrieved_at":"2026-09-24"}],"freshness":{"type":"static","max_age_seconds":null,"note":"Deterministic formula with fixed constants; results never go stale. Inputs supplied by the caller determine the output."},"examples":[{"name":"Rent 2,000 vs 400,000 home, 80,000 down, 6.5 %, 10 years","inputs":{"monthly_rent":2000,"rent_growth_percent":3,"home_price":400000,"down_payment":80000,"annual_rate_percent":6.5,"term_years":30,"property_tax_percent":1.2,"maintenance_percent":1,"home_appreciation_percent":3,"investment_return_percent":7,"years":10},"expected":{"total_cost_of_renting":275133.1,"total_cost_of_buying":290545.23,"net_advantage_of_buying":-15412.13,"better_option":"Renting","monthly_principal_and_interest":2022.62,"total_mortgage_payments":242714.12,"total_property_tax_and_maintenance":100882.14,"upfront_cash":92000,"opportunity_cost_of_upfront_cash":88977.92,"home_value_at_end":537566.55,"loan_balance_at_end":271283.6,"net_equity_at_sale":234028.95},"url":"https://tttkmbb.com/api/v1/calculate/rent-vs-buy?monthly_rent=2000&rent_growth_percent=3&home_price=400000&down_payment=80000&annual_rate_percent=6.5&term_years=30&property_tax_percent=1.2&maintenance_percent=1&home_appreciation_percent=3&investment_return_percent=7&years=10"},{"name":"Rent 2,500 vs 350,000 home, 70,000 down, 5.5 %, 4 % appreciation, 15 years","inputs":{"monthly_rent":2500,"home_price":350000,"down_payment":70000,"annual_rate_percent":5.5,"home_appreciation_percent":4,"investment_return_percent":6,"years":15},"expected":{"total_cost_of_renting":557967.42,"total_cost_of_buying":235331.02,"net_advantage_of_buying":322636.4,"better_option":"Buying","monthly_principal_and_interest":1589.81,"net_equity_at_sale":397939.2,"average_monthly_cost_of_renting":3099.82,"average_monthly_cost_of_buying":1307.39},"url":"https://tttkmbb.com/api/v1/calculate/rent-vs-buy?monthly_rent=2500&home_price=350000&down_payment=70000&annual_rate_percent=5.5&home_appreciation_percent=4&investment_return_percent=6&years=15"}],"faq":[{"q":"Why does a short horizon favour renting?","a":"Buying and selling cost roughly 9 % of the price in this model (3 % + 6 %), and early mortgage payments are mostly interest, so equity builds slowly; those fixed costs need several years of appreciation and rent growth to be recovered."},{"q":"What is the opportunity cost line?","a":"The down payment and closing costs could have been invested. Their forgone return (not the principal, which the buyer recovers as equity) is counted as a cost of buying."},{"q":"Which return should I assume?","a":"Use the same basis for both sides: a nominal investment return with nominal appreciation and rent growth. Long-run US figures are roughly 7 % for equities, 3–4 % for house prices and 3 % for rents, but local values vary widely."}],"tags":["rent vs buy","renting vs buying","should i buy a house","cost of owning a home","home ownership cost","opportunity cost"],"related":[{"calculator_id":"mortgage-payment","reason":"Full monthly payment with taxes and insurance."},{"calculator_id":"compound-interest","reason":"Growth of the down payment if invested instead."},{"calculator_id":"inflation","reason":"Express future amounts in today's money."}],"links":{"html":"https://tttkmbb.com/finance/rent-vs-buy","markdown":"https://tttkmbb.com/finance/rent-vs-buy.md","json":"https://tttkmbb.com/finance/rent-vs-buy.json","api":"https://tttkmbb.com/api/v1/calculate/rent-vs-buy","schema":"https://tttkmbb.com/api/v1/calculators/rent-vs-buy","openapi":"https://tttkmbb.com/openapi.json","mcp":"https://tttkmbb.com/mcp"},"version":"v1","updated_at":"2026-09-24"},"timestamp":"2026-09-24T02:03:28Z","next_actions":[{"tool":"run_calculator","calculator_id":"rent-vs-buy","reason":"Run Rent vs. Buy Calculator with the inputs above."}],"links":{"markdown":"https://tttkmbb.com/finance/rent-vs-buy.md"}}