Compare the full cost of occupancy
Model after-tax cash flows, financing, appreciation, opportunity cost, and sale proceeds on a consistent present-value basis.
Tax treatment: lease operating costs are assumed deductible. Ownership deductions include mortgage interest, property tax, property insurance, maintenance, and straight-line depreciation of the building and capital improvements. Principal and down payment are not deducted. Tax rules vary; no depreciation recapture or capital-gains tax is modeled.
Average monthly occupancy cost over 10 years
How leasing can create value
Potential value if cash saved versus buying is invested at the selected discount rate.
How buying creates value
Projected ownership position at the end of the analysis period.
Decision considerations
Financial results are only one part of the occupancy decision.
Recommendation context: Review the Charts & Data tab to see the supporting cash flows. Results depend heavily on appreciation, holding period, financing, maintenance, taxes, and selling costs.
Annual after-tax occupancy cash outflow
Year-by-year cash-flow detail
| Year | Lease cash flow Annual base rent, CAM/NNN, and tenant insurance, less estimated income-tax savings. | Buy cash flow Annual mortgage principal and interest, property tax, insurance, and maintenance, less estimated income-tax savings. Principal reduces the loan and builds equity. | Principal | Interest | Loan balance | Property value |
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Cash flows shown are after estimated income-tax savings. Principal is a cash outflow that also increases ownership equity. Amounts are nominal annual values, not present values.
