https://calculating.ca/calculators/real-estate/rent-vs-buy-scenario-calculator/
Real Estate / THE MITEY TOOLKIT
Rent vs Buy Scenario
Compare modeled home equity and investment balances with equal starting cash and invested monthly cost differences.
Buy-side wealth minus rent-side wealth
$58,669.58
From your inputs. Explore the breakdown below.
- Buy-side modeled net wealthi
- $353,893.14
- Rent-side investment balance
- $295,223.56
- Mortgage balance at horizon
- $348,247.65
- Modeled home value
- $731,396.65
- A positive difference favours the buy-side assumptions; a negative difference favours the rent-side assumptions. Neither predicts what will happen.
- Change growth, investment return, costs and timing before relying on one scenario.
CHANGE ONE VARIABLEWhat moves your answer?
Compare five values while keeping every other input the same. These are scenarios, not likelihoods or forecasts.
| Input value | Primary result | Use scenario |
|---|
BEHIND THE ANSWER
Formula and method
Buy-side wealth = home value − selling costs − mortgage balance + invested cost differences. Rent-side wealth = invested initial cash + invested cost differences.
The renter invests the down payment plus buying costs. Each month the cheaper side invests the difference between rent and ownership outgoings. Mortgage principal follows a fixed-rate monthly ledger; investment and home-value assumptions are converted to equivalent monthly growth. Selling costs are deducted from the buy-side result.
Context sources checked October 24, 2026
These sources explain the subject. The model follows the formula and assumptions shown here; a source link does not imply endorsement.
Worked examples
A ten-year comparison
- Home price:
- 600000
- Down payment:
- 120000
- Mortgage annual fixed rate:
- 4.5
- Mortgage amortization:
- 25
- Comparison period:
- 10
- Initial monthly rent:
- 2500
- Other monthly ownership costs:
- 700
- Up-front buying costs:
- 12000
- Selling costs · % of home value:
- 4
- Annual home value change:
- 2
- Annual investment return assumption:
- 4
- Annual rent and ownership cost growth:
- 2
Buy-side wealth minus rent-side wealth: $58,669.58
No-growth, no-interest comparison
- Home price:
- 120000
- Down payment:
- 24000
- Mortgage annual fixed rate:
- 0
- Mortgage amortization:
- 10
- Comparison period:
- 5
- Initial monthly rent:
- 800
- Other monthly ownership costs:
- 0
- Up-front buying costs:
- 0
- Selling costs · % of home value:
- 0
- Annual home value change:
- 0
- Annual investment return assumption:
- 0
- Annual rent and ownership cost growth:
- 0
Buy-side wealth minus rent-side wealth: $48,000.00
Assumptions and limits
- Constant mortgage rate for the model; Canadian fixed-rate conversion.
- Other ownership costs must include the tax, insurance, maintenance and condo costs you want modeled.
- No investment taxes, mortgage insurance, tax rebates, deposits or lifestyle preferences are modeled.
- Rent and other ownership costs grow at the same entered rate.
This tool provides an educational estimate. Rules, rates and personal circumstances can change the answer. Review the assumptions before relying on a result. Report a correction.
Common mistakes to avoid
- Treating an illustrative rate as a lender quote or a return forecast.
- Comparing scenarios with different time periods or leaving out relevant fees.
Frequently asked questions
Is the down payment treated fairly on both sides?
The buyer contributes it to the home. The renter invests the same amount, plus the entered up-front buying costs. Monthly cost differences are invested by whichever side is cheaper in that month.
Does the result say whether I should buy?
No. It compares the assumptions you entered. Future prices, returns, rent, borrowing rates, transaction costs and personal circumstances can change the outcome.
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