Rent vs Buy Calculator
Renting or buying? Our free Rent vs Buy Calculator compares both paths side by side - rent hikes, down payment, home appreciation, and selling costs - so you can see which option comes out ahead over your time horizon.
Rent vs buy
Compare the true cost of renting a home versus buying one over your time horizon.
Loan tenure
Comparison horizon
FAQs
How long do I need to stay for buying to make sense?
There is no universal number - it depends on prices, rents, interest rates, and appreciation in your area. In many markets the breakeven falls between 5 and 10 years, but high-cost cities can push it beyond a decade. Enter your own numbers to find your personal breakeven.
Does the calculator include home maintenance and selling costs?
A good comparison must include them. Maintenance and repairs typically run about 1% of the home's value per year, and selling costs (agent fees, closing costs) often total 6-9% of the sale price. Leaving these out makes buying look better than it really is.
How it works
Deciding whether to rent or buy is one of the biggest financial choices most people face. The monthly mortgage payment looks comparable to rent at first glance, but buying also involves a down payment, closing costs, maintenance, property taxes, and insurance - while renting usually only means rent plus renter's insurance.
For example, consider a $300,000 home with a 10% down payment versus renting a similar place for $1,500/month with 3% annual rent increases. Over 5 years, renting often wins once you include buying's upfront costs. Over 15-20 years, buying typically pulls ahead as rent keeps rising while the mortgage payment stays fixed and the home appreciates.
The breakeven point - the number of years after which buying becomes cheaper - is the key output. If you expect to move before the breakeven point, renting is usually the better financial move, regardless of how attractive ownership sounds.
Remember that the calculator compares finances, not lifestyle. Owning brings stability and the freedom to modify your space; renting brings flexibility and freedom from maintenance surprises. Use the numbers as one input to a bigger decision.
Why the Breakeven Year Is Everything
Buying a home front-loads your costs: down payment, closing fees, moving expenses, and immediate repairs all hit in year one. Renting spreads costs evenly. That imbalance is why short stays almost always favor renting - you simply don't own long enough for appreciation and principal paydown to offset the upfront hit.
The breakeven year is where the cumulative cost curves cross. Before it, renting is cheaper; after it, buying wins and the gap usually keeps widening. If your plans are uncertain, weight the scenarios by how long you realistically expect to stay, not by the rosiest case.
Rent Hikes Are the Silent Decider
Most rent-vs-buy comparisons hinge on one assumption: how fast rent rises. A $1,500 monthly rent growing 4% a year becomes about $2,220 in 10 years, while a fixed-rate mortgage payment stays flat. Even modest rent inflation compounds into a large advantage for owners over long horizons.
But the reverse is also true. In markets with rent controls, abundant new construction, or flat demand, slow rent growth extends the breakeven year dramatically. Use a rent growth rate that matches your city's history, not a national average.
The Non-Financial Factors That Tip the Scale
Money isn't the whole story. Buying locks in your housing cost and gives you control - no landlord decisions, no forced moves. For families valuing school stability or people who love customizing their space, that control has real value beyond the spreadsheet.
Renting, meanwhile, buys optionality: easy relocation for a job, no surprise $8,000 roof bill, and a down payment that stays invested and liquid. If your career or life is in flux, the flexibility premium of renting can outweigh a modest financial edge for buying.