Rent vs. Buy Glossary
Estimated Total Costs of Renting
The total current rental payments for the same number of years you would plan to own a home increased by a yearly rental increase adjustment.
Estimated Gross Costs of Buying
Total principal and interest payments over the number of years that you plan to own your home.
Estimated Increase in Equity
A specified property value increased by a selected rate of appreciation for a specific number of years.
Estimated Net Costs of Buying
The estimated gross costs of buying minus estimated tax savings and the estimated increase in equity.
Estimated Tax Savings
The amount of tax a renter would save instead of owning a home based on property taxes and interest paid.
Estimated Total Savings
The estimated net costs of renting minus the lower net cost of buying.
Estimated Investment Related Savings
The estimated total savings of buying invested at a rate of 8% for the number of years that a borrower would plan to own a home.