Rent vs Buy Calculator — 5-Year Horizon
The short-stay test: the calculator preset to a five-year horizon, where buying's one-off costs bite hardest. The default $400,000 scenario still favors buying — by $15,023.59, down from $46,398 at seven years — but the margin is thin enough that softer appreciation or higher selling costs flip it. Five years is the conventional threshold where the rent-vs-buy question genuinely opens up.
Rent vs buy over your horizon
Cheaper over 5 years
Buying
by $15,024 under these assumptions
Breakdown
Assumes 3% buyer closing costs, 7% selling costs, constant rates, and no itemized tax deduction. A scenario comparison, not housing-market advice.
Five years is where verdicts get fragile
Over five years the owner pays $267,401.77 in total and recovers $142,264.18 of equity at sale, netting $125,137.60 against $140,161.19 of rent. A $15,000 margin on numbers that large is noise-level: one percentage point less appreciation, a costlier roof, or selling into a soft market erases it. Treat a five-year verdict as "close call" unless your inputs are unusually firm.
The practical reading: at five years, buy if you're confident in the stay and the neighborhood, rent if there's real chance of moving at year three. The spreadsheet margin won't survive an early exit — the 7% selling cost on its own is about $33,000 of the five-year math.
Questions
- Should I buy if I'm only staying five years?
- It's the borderline case. The default scenario favors buying by $15,023.59 over five years, but modest changes in appreciation or selling costs flip the verdict — run your own assumptions both ways.
- What stay length clearly favors buying?
- Under the default assumptions the buy margin grows steadily with time — about $15,000 at five years and $46,398 at seven. The longer and more certain the stay, the more decisively owning wins.
More ways to use this calculator
Start with the main rent vs buy calculator or compare the other published scenarios.
Related calculators on Category Index