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How to use the Compare Rentals calculator
Compare Rentals works out whether moving to a cheaper place is worth it once the cost of moving is counted. A lower rent is easy to see. The deposit, the truck and the new fibre install are easy to forget, and they are what decide whether the move pays.
The tool adds up the full monthly cost of each place, not just the rent, then subtracts the once-off cost of moving. It shows the month the savings finally pay that back, and how far ahead you are by the end of your horizon.
A move that saves R300 a month but costs R12,000 to make takes over three years to pay for itself. If you are not staying that long, the cheaper rent is a false economy. This puts that break-even in front of you before you sign.
What you'll need
- For both places: the rent, plus internet, rates, power, water and anything else you pay monthly.
- The once-off cost of moving: deposit, the truck, any overlap rent, new furniture.
- The annual escalation to apply to both, and how many years you plan to stay.
How to use it
Fill in the current place and the new place with their full running costs, not just rent. A flat with cheap rent and expensive prepaid electricity can cost more than it looks.
List every once-off cost of the move on the moving-costs card. Then set the yearly increase and your horizon. The horizon matters: a move that never breaks even in three years often does in five.
Reading your result
The monthly saving is the headline: how much cheaper, or dearer, the new place is each month. The move-pays-off figure is the one to respect, the number of months until the saving has repaid the once-off cost.
The cumulative-savings chart crosses zero at that break-even point. Below the line you are still down on the move; above it you are genuinely saving. The two cost charts show each place month to month and in total.
A worked example
Your current place costs R10,950 a month all in; the new one costs R9,650. Moving costs R7,500 in total, both rents escalating 5% a year, over a five-year stay.
That is R1,300 a month cheaper. The R7,500 move is repaid in 6 months, and by year five you are R78,700 ahead. A clear move. Halve the saving to R650 a month and the same R7,500 move takes nearly a year to pay back, which changes the call if you might leave sooner.
What it does not do
It compares cost only. It cannot weigh a shorter commute, a better area, or a longer drive to work, which are often the real reasons to move. Put your numbers in and let it handle the money side.
Weighing buying instead of renting again? The Rent vs Buy calculator runs that comparison. When you are ready, open Compare Rentals.
Money Cat is an information tool, not financial advice. The figures are only as good as the costs you enter, so use your real bills.