Rent vs Buy Calculator
Compare estimated costs of buying and renting over a period you choose. Results depend on your assumptions for rent, home costs, price changes and investment returns.
With the current inputs, estimated monthly ownership costs are AED 2,499.12 and starting rent is AED 2,200.00. These are editable scenario assumptions, not a market average or financial recommendation.
AED 127,493.52
Buying generates higher estimated net worth after home equity and any invested monthly savings are combined.
AED 322,327.28
Equity after sale costs plus investmentsAED 194,833.76
Invested portfolioAED 2,499.12
P&I, tax, insurance, PMI, HOA & upkeepAED 2,200.00
Year 1 monthly rentCalculation is instantly saved in this shareable URL.
🗄️ Saved Comparison Scenarios (Side-by-Side)
Net Worth Trajectory Over Time
Year-by-Year Financial Progression
Tracking home appreciation, declining mortgage balance, buyer equity, and renter investment compounding.
| Year | Property Value | Mortgage Debt | Buyer Net Worth | Renter Net Worth | Net Advantage |
|---|---|---|---|---|---|
| Yr 1 | AED 463,500.00 | AED 351,968.03 | AED 83,721.97 | AED 108,610.88 | AED -24,888.91 |
| Yr 2 | AED 477,405.00 | AED 343,571.23 | AED 105,189.47 | AED 118,000.40 | AED -12,810.93 |
| Yr 3 | AED 491,727.15 | AED 334,793.07 | AED 127,430.45 | AED 127,130.47 | +AED 299.99 |
| Yr 4 | AED 506,478.96 | AED 325,616.23 | AED 150,474.00 | AED 135,959.93 | +AED 14,514.07 |
| Yr 5 | AED 521,673.33 | AED 316,022.56 | AED 174,350.37 | AED 144,444.33 | +AED 29,906.04 |
| Yr 6 | AED 537,323.53 | AED 305,993.17 | AED 199,908.59 | AED 153,353.34 | +AED 46,555.25 |
| Yr 7 | AED 553,443.24 | AED 295,508.25 | AED 227,357.92 | AED 162,811.84 | +AED 64,546.08 |
| Yr 8 | AED 570,046.54 | AED 284,547.11 | AED 256,821.93 | AED 172,853.72 | +AED 83,968.22 |
| Yr 9 | AED 587,147.93 | AED 273,088.15 | AED 288,431.88 | AED 183,514.96 | +AED 104,916.93 |
| Yr 10 | AED 604,762.37 | AED 261,108.72 | AED 322,327.28 | AED 194,833.76 | +AED 127,493.52 |
How this rent-versus-buy calculator compares costs
The estimate compares home equity after projected appreciation, remaining mortgage balance and selling costs with the renter's invested upfront cash. Each month, the scenario with lower housing costs can invest the difference. Mortgage payments use a fixed-rate amortization formula; future home values, rent, costs and investment returns are assumptions you can change.
Country-specific costs and tax treatment
Local taxes, insurance, mortgage rules, and transaction costs vary. Enter the costs that apply to your home and verify current rules with a local authority or lender. Investment returns and home-price changes are not guaranteed.
Calculation Methodology & Proof
Rent vs buy
Both paths start with the same cash. The buyer puts it into the house; the renter invests it. Each year we compare net worth.
- Buyer cash outlay: down payment + buy closing, then PITI + maintenance each month.
- A simplified tax deduction reduces buyer cost by interest × marginal rate.
- Renter pays rent (growing) and renter insurance, and keeps the invested stake growing.
- Break-even is the first year buyer net worth exceeds renter net worth.
Important Caveats & Planning Assumptions
- Appreciation, returns, and rent growth are assumptions, not forecasts.
- Transaction costs and taxes on sale are stylized.
Frequently Asked Questions
Expert answers to common questions
Why can renting win on paper?
If the down payment would earn a high return, if you move before break-even, or if buy costs (tax, maintenance, selling costs) are high relative to rent.
Do you include the mortgage interest deduction?
A simplified deduction using your marginal tax rate is applied to interest. Caps, standard-deduction effects, and local tax treatment are not fully modelled.
What is 'advantage'?
Buyer net worth (home equity after selling costs) minus renter net worth (invested cash). Positive means buying is ahead in that year.