Rent vs Buy Calculator
Compare buying a home with renting and investing the money you would otherwise put into a down payment, closing costs, higher monthly payments, taxes, insurance, repairs, and selling costs. See the break-even year and projected net worth for both paths.
Answer from your assumptions
Renting may make more sense
If these numbers hold, renting is ahead by about $18.6K after 7 years.
Buying path
$194.7K
Rent-and-invest path
$213.3K
Enter the home and rental you would actually choose
Use a real listing, a comparable rental, your expected mortgage rate, and the number of years you would stay before selling or moving. The comparison is weakest when the rental and home are not similar.
Your numbers are used only for this browser-session calculation. The tool does not require an account or ask you to save a home address, income, or loan application details.
Use a price from $1 to $100,000,000.
Use a monthly rent from $1 to $250,000.
Allowed range: 0% to 100%.
Allowed range: 0% to 30%.
Allowed range: 1 to 40 years.
Allowed range: -50% to 50% per year.
Rent vs buy result
Estimated net-worth advantage
$18.6K
Mortgage payment
$2,275
First-year owner cost
$3,194
Starting rent
$2,400
Assumptions used
These defaults can move the answer. Adjust them if local taxes, HOA dues, insurance, or expected investment returns differ from your situation.
- Property tax
- 1.1% / yr
- Maintenance / HOA
- 1% / yr
- Home insurance
- 0.35% / yr
- Rent increase
- 3% / yr
- Investment return
- 5% / yr
- Closing / selling
- 3% / 6%
Projected net worth by year
Buying vs rent-and-investYear 1
Renting ahead by $38.8K
Buying path
$79.7K
Rent-and-invest path
$118.5K
Planned 7 years
Renting ahead by $18.6K
Buying path
$194.7K
Rent-and-invest path
$213.3K
Break-even year 11
Buying ahead by $7.8K
Buying path
$288K
Rent-and-invest path
$280.3K
What the buying path counts
Home equity after estimated sale costs: $194,738
Buyer closing costs paid upfront: $13,500
Extra cash invested: $0
What the renting path counts
Down payment and monthly savings invested: $213,339
What is driving this result
- A stronger investment return makes renting more competitive in this comparison.
Before trusting the answer
- Use the stay length you would actually commit to, not the 30-year mortgage term.
- Add HOA dues, local insurance premiums, and repair reserves to the ownership side.
- If you would spend the monthly savings instead of investing them, lower the investment return.
How this rent vs buy calculator works
The calculator compares two wealth paths. The buying path starts with your down payment, mortgage payment, property tax, insurance, maintenance, home appreciation, remaining loan balance, buyer closing costs, and selling costs. The renting path starts with the same down payment and buyer closing cost cash invested instead.
Each month, the calculator compares the estimated cost of owning with the estimated rent. If owning is more expensive, the renter invests the difference. If renting is more expensive, the buyer invests the difference. That keeps the comparison focused on net worth, not just monthly payment size.
The break-even year is the first year where the buying path is ahead. If buying breaks even after year 11 and you may move in year 5, the rent-and-invest path may be stronger even when you can afford the mortgage.
Costs included in the comparison
A mortgage calculator usually shows principal and interest. A rent vs buy decision needs more than that. Property taxes, homeowners insurance, maintenance, HOA dues, selling costs, rent increases, and the opportunity cost of the down payment can change the answer. If you need a payment baseline first, use the loan calculator to estimate the mortgage payment.
This tool handles the recurring ownership costs as annual percentages of the home value. If your HOA is a monthly dollar amount, estimate the annual HOA total as a percentage of the purchase price and add it to maintenance. For example, a $300 monthly HOA on a $450,000 home is about 0.8% per year.
Buying side
Down payment, buyer closing costs, mortgage payment, property tax, home insurance, maintenance, home appreciation, remaining mortgage balance, and selling costs. You can also see the amortization schedule behind the loan balance.
Renting side
Starting rent, annual rent increases, invested down payment, and invested monthly savings when rent is cheaper than owning. Use the interest calculator to compare investment growth assumptions.
Example: seven-year stay
- Purchase price
- $450,000
- Comparable rent
- $2,400 / month
- Down payment
- 20%
- Planned stay
- 7 years
With a high mortgage rate, the first few years may favor renting because the down payment stays invested and the buyer pays transaction costs. Buying usually needs enough time for appreciation and principal paydown to overcome those early costs.
Default result preview
- Buying path
- $194,738
- Rent-and-invest path
- $213,339
- Break-even
- Around year 11
Under these default assumptions, renting is ahead by about $18,601 after 7 years. The calculator still shows the exact answer from your own inputs at the top of the page.
Run these three scenarios
Short stay under 5 years
Set your stay length to 3 or 4 years, then check whether closing costs and selling costs push the break-even year past your likely move date.
High rent and rising rent
Increase comparable monthly rent and annual rent growth to test whether buying catches up faster in a market where leases renew at higher prices.
High mortgage rate case
Raise the mortgage interest rate, property tax, and repair reserve to see how much higher owner costs affect the rent-vs-buy result.
When this calculator is not enough
Use this as a financial comparison, not as a final home-buying recommendation. It does not know your credit approval, emergency fund, job stability, school plans, commute tradeoffs, landlord risk, or how much you value the option to move.
It also does not model itemized tax deductions, PMI, refinancing, capital gains taxes, rental deposits, utility differences, or large one-time repairs. Add those separately if they are material in your situation.
Rent vs buy calculator FAQ
What is the break-even year for buying a house?
It is the first year when the estimated buying path is worth more than the rent-and-invest path. A break-even year after your likely move date is a warning sign for buying on financial grounds.
Is renting throwing money away?
Not automatically. Rent pays for housing and flexibility. Buying builds equity, but mortgage interest, taxes, repairs, insurance, and selling costs are also real expenses.
Does this include mortgage tax deductions?
No. Mortgage interest and property tax deductions depend on filing status, itemizing, deduction caps, and local tax details. Treat any tax benefit as an adjustment to review separately.
Why does the renting path invest the difference?
Renting usually requires less cash upfront. Investing the down payment and any monthly savings creates a fairer comparison against the equity built through ownership.
What if I expect major repairs or HOA fees?
Increase the maintenance rate in advanced assumptions. For HOA fees, add the annual amount as a rough percentage of the home price and include it in maintenance.
Can this tell me whether I should buy now?
It can show the financial tradeoff under your assumptions, but it cannot judge job stability, school plans, relocation risk, financing approval, or how much flexibility is worth to you.
Are my home price and rent numbers saved?
No account is needed, and the calculator only uses your entries to update the result in this browser session. Avoid entering private address, income, or loan application details.
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