📖 Overview
Use this tool to estimate when ownership savings may offset upfront buying costs.
⚙️ How It Works
This estimates when monthly ownership savings recover upfront buying costs.
The Formula
Break-Even Months = Upfront Buying Costs ÷ (Rent − Monthly Ownership Cost)
| Upfront Costs | Down payment, closing costs, and fees to buy |
| Monthly Ownership | PITI + maintenance + HOA − equity build |
| Monthly Savings | Rent minus monthly ownership cost (must be positive) |
💡This is a simplified cash-flow model. A complete rent vs. buy analysis should also account for opportunity cost on the down payment, tax benefits, and home appreciation.
Quick Reference
| Monthly Savings | $5k upfront | $15k upfront | $30k upfront | $50k upfront |
|---|---|---|---|---|
| $100/mo | 50 mo | 150 mo | 300 mo | 500 mo |
| $200/mo | 25 mo | 75 mo | 150 mo | 250 mo |
| $300/mo | 17 mo | 50 mo | 100 mo | 167 mo |
| $500/mo | 10 mo | 30 mo | 60 mo | 100 mo |
Practical Tips
💡 Include all ownership costs, not just mortgage.
💡 Recalculate if rent or ownership costs change.
Frequently Asked Questions
❓ What if ownership is not cheaper monthly?
Then break-even may not occur under current assumptions.
❓ Does this include appreciation?
No, this model focuses on cash flow break-even timing.