Rent vs Buy NPV Calculator
Compare actual separately qualified rent scenario and buyscenariocashflowNPV, p0initial, timing/currency/rate independent. Not invent cash flows, owner gains, tax/maintenance/appreciation or choose housing.
Description
Rent-versus-buy NPV compares independently specified scenario cash flows on the same timeline.
Rent-versus-buy NPV compares independently specified scenario cash flows on the same timeline.1
Taxes, maintenance, financing and terminal proceeds must already be represented where applicable. The calculation and input requirements are explained below.
When to use Rent vs Buy NPV Calculator
Enter nonempty aligned rent and buy net-cash-flow lists and a discount rate greater than -1.
How to use Rent vs Buy NPV Calculator and how it works
- Prepare the measurements or independently established model inputs described below, with matching units and observation scope.
- Enter the required fields and run Rent vs Buy NPV Calculator.
- Read the result fields using the formula, output units, signs and ordering explained below.
- Correct any rejected inputs and rerun; interpret the result within the stated model and its assumptions.
| Input field | Meaning | Value type | Requirement |
|---|---|---|---|
| actualRentNetCashFlowsByPeriod | Actual Rent Net Cash Flows By Period. Use the units and matching context stated in the calculation below. | array of number | Required; other constraints below |
| actualBuyNetCashFlowsByPeriod | Actual Buy Net Cash Flows By Period. Use the units and matching context stated in the calculation below. | array of number | Required; other constraints below |
| callerApplicableDiscountRate | Caller Applicable Discount Rate. Use the units and matching context stated in the calculation below. | number | Required; finite; other constraints below |
Enter nonempty aligned rent and buy net-cash-flow lists and a discount rate greater than -1. List index 0 is undiscounted initial cash flow; later entries use their zero-based period as exponent. Return both NPVs and signed buy-minus-rent NPV. The tool does not generate costs, taxes, appreciation or a housing recommendation.
NPV=sum(cash_i/(1+r)^i); difference=buyNPV-rentNPV Apply the input ordering, units and branch conditions stated above.
| Output field | Meaning | Value type |
|---|---|---|
| result | Object containing the calculated or selected fields below. | object |
| result.rentScenarioNpv | Rent Scenario Npv. Interpret its unit, sign, order or availability flag as explained above. | number |
| result.buyScenarioNpv | Buy Scenario Npv. Interpret its unit, sign, order or availability flag as explained above. | number |
| result.signedBuyMinusRentNpv | Signed Buy Minus Rent Npv. Interpret its unit, sign, order or availability flag as explained above. | number |
{
"input": {
"actualRentNetCashFlowsByPeriod": [
-10,
-10
],
"actualBuyNetCashFlowsByPeriod": [
-20,
5
],
"callerApplicableDiscountRate": 0
},
"output": {
"result": {
"rentScenarioNpv": -20,
"buyScenarioNpv": -15,
"signedBuyMinusRentNpv": 5
}
}
}Limitations and assumptions
The calculation uses the supplied observations and model inputs. It does not collect measurements, select a reference population or coefficient, or establish that the model applies to the actual case. The stated branch conditions and output units remain part of the result.
All fields require explicit values. Unexpected fields, wrong types, nonfinite numbers and sparse arrays are rejected. Alignment, bounds and supported-token rules are explained above; extremely large inputs or nonfinite results can also fail. Input errors differ from successful false comparisons, unavailable-domain flags and empty match lists.
Housing comparisons require costs such as taxes, insurance, maintenance and transaction costs where applicable. This calculator discounts supplied scenario ledgers and does not populate those assumptions.2
Alternative or Complementary methods
Use Rent vs Buy Breakeven Calculator for a complementary operation: An observed rent-versus-buy break-even point compares cumulative costs at discrete periods.
Use Home Affordability Calculator for a complementary operation: Purchase-price caps can summarize separately assessed affordability constraints.
References
-
Rent vs Buy NPV Calculator — tool.io
-
CFPB: Financial considerations of buying a home — Consumer Financial Protection Bureau
Similar or alternative tools
- Rent vs Buy Breakeven Calculator
An observed rent-versus-buy break-even point compares cumulative costs at discrete periods.
- Home Affordability Calculator
Purchase-price caps can summarize separately assessed affordability constraints.