Rent vs Buy Calculator

How This Calculator Works

This is the most comprehensive free rent vs buy calculator built specifically for Canadians. It compares the true cost of renting versus buying over time, accounting for factors most calculators miss.

Opportunity Cost (The Big One)

If you rent instead of buying, you keep your down payment and closing costs. That money can be invested. Each month, if owning would cost more than renting, the difference also gets invested. This calculator models that investment growth and subtracts the gains from your total renting costs. Most Canadian calculators skip this entirely — but it is often the single largest factor in the decision.

Canadian Mortgage Math

Canadian mortgages compound semi-annually, not monthly like American mortgages. This calculator uses the correct Canadian formula: the posted rate is converted to an effective monthly rate using semi-annual compounding. The difference is small but real, and it means your actual monthly payment is slightly lower than what a US-based calculator would show.

Provincial Land Transfer Tax

Land transfer tax varies wildly by province. In Ontario, you can pay over $6,000 on a $550,000 home. In Toronto, double that. Alberta and Saskatchewan charge almost nothing. This calculator applies the correct brackets for your province and accounts for first-time home buyer rebates where available.

What "Net Cost" Means

For renting: total rent paid minus investment gains from the money you did not spend on a house. For buying: total cash spent (down payment, closing, mortgage payments, taxes, insurance, maintenance, selling costs) minus the net equity you walk away with if you sell. Whoever has the lower net cost wins.

What This Calculator Does Not Include

This is a simplified model. It does not account for provincial income tax differences affecting investment returns, potential rental income from a basement suite, the emotional and spiritual value of stability for your family, or future interest rate changes on renewal. Property tax is held constant (in reality, assessed values and rates change). Use it as a strong starting point, not gospel.

The CMHC Factor

If your down payment is less than 20%, you are required to purchase mortgage default insurance from CMHC (or a private insurer). The premium ranges from 2.8% to 4% of the mortgage amount and is added to your mortgage balance. This calculator estimates that cost automatically and includes it in your mortgage payments.

For a deeper look at the homebuying process in Canada, including FHSA, RRSP Home Buyers' Plan, and what to expect at closing, read our Christian Homebuying Guide.