Buy or keep renting — which really costs less?
Buying and renting distribute housing costs differently. Buying adds an asset and usually debt, while renting keeps more money flexible. A useful comparison follows both paths over the same period and includes the cash needed along the way, not only the final net worth.
What shapes the comparison
- The purchase price, down payment, mortgage terms and timing of the purchase.
- Rent and the month it would stop if you bought a home.
- Property value growth and every ownership cost you represent in the plan.
- How savings and investments change when money is used for the purchase.
- How long you expect to compare the two paths and how flexible you need to remain.
Model both paths from the same starting point
Keep renting in the baseline plan. In a duplicate, add the home purchase and remove rent only from the month it actually ends. Hold income, ordinary spending and the comparison horizon constant unless the decision itself changes them.
Compare accessible money and debt as well as property value and final net worth. Buying can build equity while creating a tighter reserve; renting can preserve flexibility while leaving more money available to save or invest.
Questions worth testing
- How much accessible money remains immediately after the purchase?
- Which path is more resilient to a change in income or a large expense?
- How does a later purchase date change the reserve and mortgage?
- Which unmodelled ownership or moving costs could alter the comparison?
How to read the result
The comparison reflects only the costs, dates, and growth assumptions you enter. It does not predict property prices or rent, assess the flexibility or stability of either option, or include maintenance, insurance, fees, tax, and moving costs unless you add them. This is not financial, investment, tax, mortgage, or property advice.
How it works in the app
Model the purchase honestly: buy the home as owner-occupied with rent at 0, then add a dated expense change that drops the rent portion of your living expenses from the same month. Now the plan compares buying against renting on equal terms, instead of paying rent twice.
- Tap “Buy a property”, set the price and mortgage, and leave rent at 0 for owner-occupied.
- Tap “Change your expenses” and lower your yearly expenses by the rent you stop paying, from the purchase month.
- Compare net worth and runway against the plan where you keep renting.
Model this yourself