Rent vs Buy Calculator
Compare renting and investing your savings against buying an Australian home over time, factoring in mortgage costs, property growth and opportunity cost.
Your results
Year-by-year comparison
| Year | Rent paid | Ownership cost | Home equity | Renter investment |
|---|---|---|---|---|
| 1 | $28,600 | $42,000 | $187,368 | $209,768 |
| 2 | $29,458 | $41,545 | $226,391 | $240,166 |
| 3 | $30,342 | $41,063 | $267,144 | $271,200 |
| 4 | $31,252 | $40,550 | $309,707 | $302,875 |
| 5 | $32,190 | $40,007 | $354,164 | $335,197 |
| 6 | $33,155 | $39,429 | $400,602 | $368,170 |
| 7 | $34,150 | $38,816 | $449,113 | $401,796 |
| 8 | $35,174 | $38,165 | $499,793 | $436,079 |
| 9 | $36,230 | $37,475 | $552,743 | $471,021 |
| 10 | $37,317 | $36,741 | $608,069 | $506,623 |
Calculation breakdown
- Ownership cash cost
- Mortgage interest paid this year + maintenance + rates + insurance (principal repaid builds equity, not a cost)
- Renter investment balance
- Grows at the assumed investment return, plus any cash saved by renting instead of paying ownership costs
Assumptions
- This is a transparent, simplified model — it is not a prediction of future property or investment markets.
- Renting is assumed to invest the cash difference between ownership costs and rent at the stated return.
- Neither renting nor buying is universally better; the right choice depends on your goals, stability and the numbers above.
- Selling costs, land tax, capital gains tax and lifestyle factors are not included.
How this calculator works
Whether renting or buying leaves you financially better off depends heavily on how long you stay, how fast property and rents grow, and what return your savings could otherwise earn if invested. This calculator simulates both paths year by year: a buyer pays interest, running costs and builds equity in a home that grows in value, while a renter keeps paying rent but invests the deposit, buying costs and any cash surplus in an alternative investment. It tracks each side's net financial position across your chosen analysis period and estimates the year, if any, at which buying overtakes renting. The result is sensitive to assumptions such as your expected investment return and property growth rate, so it's worth running a few scenarios rather than relying on a single set of numbers, and remember the calculator only measures financial position — it doesn't capture the lifestyle value of owning versus the flexibility of renting.
Frequently asked questions
Is buying always better than renting in the long run?
Not necessarily. It depends on property growth, rent growth, mortgage rates, how long you stay, and the return an alternative investment could achieve. There are realistic scenarios where renting and investing the difference comes out ahead.
What is the 'break-even year' in this calculator?
It's the first year in the simulation where the buyer's net financial position overtakes the renter's. Before that year, renting and investing the difference is estimated to leave you better off financially.
Does this calculator include stamp duty and other buying costs?
Yes, you can enter your total buying costs, which are added to the renter's initial investment as an opportunity cost and factored into the buyer's net position throughout the analysis.
Results are estimates only and are not financial, tax, legal or credit advice.