Understanding the real estate calculator
Real estate builds wealth mainly through appreciation the rise in a property's market value over time and through the leverage a mortgage provides. This calculator projects the future value at a steady annual appreciation rate and subtracts the costs of selling, which typically run 6 to 8% of the sale price once you include agent commissions, transfer taxes, and closing fees.
Appreciation is never smooth in reality; housing markets rise and fall in cycles, and a single assumed rate only sketches the long-run trend. Treat the net-gain figure as a planning estimate, and remember it ignores the mortgage interest, property taxes, and maintenance paid along the way a rental-property analysis captures those cash flows more fully.
Results are estimates for education only and are not financial advice.