Compliance Level 5: Investment Simulation
Monte Carlo / wealth simulation with inherent uncertainty
Compare the true long-term cost of buying a home against renting and investing the difference.
Year-by-year comparison
| Year | Home Value | Home Equity | Rent Paid to Date | Investments if Renting |
|---|---|---|---|---|
| 1 | $412,000.00 | $95,576.72 | $24,000.00 | $95,306.88 |
| 2 | $424,360.00 | $111,752.98 | $48,720.00 | $111,099.42 |
| 3 | $437,090.80 | $128,555.63 | $74,181.60 | $127,393.78 |
| 4 | $450,203.52 | $146,012.89 | $100,407.05 | $144,206.69 |
| 5 | $463,709.63 | $164,154.50 | $127,419.26 | $161,555.51 |
| 6 | $477,620.92 | $183,011.74 | $155,241.84 | $179,458.19 |
| 7 | $491,949.55 | $202,617.57 | $183,899.09 | $197,933.35 |
Important Disclaimer
This calculator provides estimates for educational purposes only. Results are based on the inputs you provide and standard financial formulas. They do not constitute financial, investment, tax, or legal advice. Consult a qualified professional before making financial decisions.
Buying only wins if home equity growth (appreciation plus principal paydown) outpaces what you'd have earned investing the down payment and any monthly savings from renting instead. When rent is far below the true cost of owning, investing the difference can outperform.
Mortgage principal and interest, property tax, insurance, and maintenance — not just the mortgage payment most people quote. This is why owning often costs meaningfully more per month than the mortgage payment alone suggests.
Yes — a default 6% selling cost (agent commissions and closing costs) is deducted from the home's value when calculating what the buyer walks away with at the end of the period.
How long you stay. Buying has large upfront costs (down payment, closing costs) that get amortized over time — the longer you stay, the more those costs are spread out, which is why buying tends to look better the longer the time horizon.
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Compare down payment sizes side by side to see the effect on your loan, PMI, and total interest
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⚠⚠ Critical Investment Warning
This calculator provides estimates for educational purposes only. Results are based on the inputs you provide and standard financial formulas. They do not constitute financial, investment, tax, or legal advice. Consult a qualified professional before making financial decisions.