Rent vs Buy Calculator

The honest answer: it depends on your timeline, your local submarket, and whether you'll actually invest the monthly savings if you rent. Our calculator shows that at today's rates, renting often wins mathematically over 10 years in the GTA — but that assumes investment discipline most people don't have. A mortgage is forced savings; a TFSA is voluntary. If you're planning to stay 10+ years and value stability, buying becomes increasingly competitive.

Three reasons. First, Toronto's home prices have outpaced rents for years — a $1M home typically rents for far less than its monthly ownership cost. Second, the renter's down payment + closing costs compound at the investment return rate, which compounds faster than mortgage principal paydown in the early years. Third, the calculator applies a 5% selling cost to home equity (realtor commissions), which eats into the buyer's position at any exit point. These are real effects, not a bias.

No — the calculator doesn't model taxes on either side. In Canada, capital gains on your principal residence are tax-free at sale, which favours buying. But investment gains in non-registered accounts are taxed (50% inclusion at marginal rate), while TFSA/RRSP gains are sheltered. The net effect depends on your specific situation. We flag this in the methodology disclosure. For tax-specific planning, consult an accountant or financial advisor.

The conventional rule of thumb says you need to own a home for at least 5 years to come out ahead of renting, to cover closing costs and early mortgage interest. Our calculator replaces that rule with your actual break-even year, which can be anywhere from 3 to 25+ years depending on rates, appreciation, and local rents. Use the "Years to Compare" slider to see when buying catches up in your scenario.

The math is correct; the assumptions are estimates. Interest rates, appreciation, rent growth, and investment returns can all vary significantly over a 10–30 year horizon. The calculator uses a constant-rate projection — reality will look different. Use it to understand the shape of the decision (which factors matter most, what break-even looks like), not to predict exact dollar outcomes. The sensitivity of the result to appreciation assumptions is a good stress test.

For a $1M home in Toronto, expect roughly $32k in combined land transfer tax (provincial + municipal), $2k in legal fees, $500 for an inspection, and incidentals — so about $35k total. Outside Toronto but in Ontario, no municipal LTT applies, so closing is roughly half that. The calculator's default ($20k) assumes an $800k home; adjust the Advanced → Closing Costs input to match your price point.

Not directly. This calculator compares renting vs buying for your primary residence. Investment properties have different dynamics — rental income, tax treatment, capital cost allowance, and the absence of the principal residence exemption. For a rental property analysis, use the Rental Cashflow calculator instead.