Rent vs Buy Calculator
Compare the long-run cost of renting against buying a home.
| Year | Net buy | Net rent | Equity |
|---|---|---|---|
| 1 | $43,018 | $20,100 | $107,524 |
| 2 | $58,399 | $40,551 | $125,722 |
| 3 | $73,106 | $61,346 | $144,625 |
| 4 | $87,095 | $82,476 | $164,265 |
| 5 | $100,324 | $103,932 | $184,674 |
| 6 | $112,745 | $125,700 | $205,888 |
| 7 | $124,308 | $147,769 | $227,945 |
| 8 | $134,960 | $170,121 | $250,882 |
| 9 | $144,643 | $192,739 | $274,743 |
| 10 | $153,299 | $215,603 | $299,568 |
Buy cost includes mortgage interest, property tax, and maintenance, less home equity (after a 6% selling cost). Rent cost subtracts the opportunity cost of investing the down payment at the market return.
About
Buying looks cheaper because rent is wasted. Renting looks cheaper because closing costs and maintenance pile up. The honest answer depends on how long you stay and what your investments would have earned. This calculator runs both paths year by year and shows the crossover.
How to use
- Enter the home price, down payment, and mortgage rate.
- Enter what you'd pay in rent for an equivalent place.
- Set the time horizon and expected home appreciation.
- See which option wins at each year and the breakeven point.
FAQ
What costs are included for owning?+
Mortgage payment, property tax (1.1% default), maintenance (1% of home value), HOA, and closing costs. The opportunity cost of the down payment is also factored in at your assumed market return.
Why does the answer flip after a few years?+
Closing costs are paid up front. The longer you stay, the more they amortize. Most people break even on buying somewhere between year 5 and year 8.