Rent vs buy calculator
Buying has upfront costs that renting does not. This calculator compares the running costs of each option over the period you expect to stay, and estimates the…
Estimated break-even point
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How this calculator works
- Total the rent paid over the period you plan to stay, including typical rent increases is left to you.
- Total the ownership running costs: mortgage interest, property tax, maintenance and the upfront costs of buying.
- Compare the two cumulative totals to find the break-even point.
- Note that the estimate excludes property appreciation, which is not guaranteed.
Formula: Compares cumulative rent against cumulative ownership cost (mortgage interest, property tax, maintenance and upfront costs)
Frequently asked questions
Does this calculator assume my home goes up in value?
No. The estimate deliberately excludes appreciation because it is not guaranteed. If prices rise, buying looks better than shown; if they fall, it looks worse.
What upfront costs does buying include?
The biggest are land transfer tax or registration fees, legal fees, title insurance, an appraisal and moving costs. These are added to the ownership total in the first year.
Is a shorter stay better for renting?
Usually yes, because the upfront costs of buying take years to amortise. The calculator shows the break-even point for your own numbers.
Sources
- OSFI Guideline B-20 — Office of the Superintendent of Financial Institutions
- Canada Mortgage and Housing Corporation — Canada Mortgage and Housing Corporation
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