Costs of buying
The model includes mortgage payments, property tax, maintenance, homeowners insurance, HOA fees, purchase costs, selling costs, and the opportunity cost of initial cash.
Rent vs. Buy Calculator
Compare renting versus buying, estimate the break-even year, and see how costs change over time.
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Estimate details
Advanced assumptions 10 inputs
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Buy costs less after 10 years$30,380
Estimated break-evenYear 8
Net cost of buying$278,805
Net cost of renting$309,186
Estimated home equity$266,283
Monthly mortgage$2,023
Annual net cost comparison
Estimated cost if you move and sell at the end of each year.
BuyRent
The buying line includes estimated sale proceeds, selling costs, home equity, and the opportunity cost of initial cash.
This is an educational estimate. Tax deductions, financing variations, market conditions, and the return on monthly cash-flow differences are not modeled.
Compare the full decision
Should you rent or buy a home?
A monthly mortgage payment and monthly rent are not directly comparable. Buying can build equity, but it also introduces financing, ownership, and transaction costs. Renting has fewer upfront costs, while rent can rise over time. The answer depends heavily on how long you expect to stay.
Costs of renting
Rent starts at the monthly amount you enter, grows by the annual rent increase, and includes renters insurance. Deposits, utilities, and moving costs are not modeled.
Value built by owning
Mortgage principal reduces the loan balance while assumed appreciation changes the home value. Estimated equity and net sale proceeds reduce the modeled cost of buying.
Why the break-even year matters
Buying often starts behind because purchase and eventual selling costs are large. The break-even year is the first modeled year in which buying costs no more than renting. If you expect to move before then, renting may remain the lower-cost option under the assumptions entered.
Change the time horizon to compare a short stay with a longer one. The chart recalculates the estimated net cost at the end of every year.
How to make the comparison useful
- Use a realistic home price, down payment, mortgage rate, and current rent.
- Enter local taxes, insurance, HOA fees, and transaction-cost estimates.
- Use conservative assumptions for appreciation, rent growth, and investment returns.
- Test more than one time horizon instead of relying on a single forecast.
Before buying, estimate your price range with the Home Affordability Calculator, monthly payment with the Mortgage Calculator, and upfront cash with the Closing Costs Calculator.
This calculator is an educational scenario tool, not a prediction or financial recommendation. Housing markets, investment returns, financing terms, taxes, and personal circumstances can change the outcome.
How this calculator works
The rent-or-buy comparison estimates mortgage payments, property taxes, maintenance, insurance, HOA fees, transaction costs, home equity, rent growth, and the opportunity cost of initial cash. The annual chart models what each choice may cost if you move at the end of that year.
Change any input to update the estimate instantly. Your entries never leave your device.
Frequently asked questions
Is renting cheaper than buying?
It depends on the home price, rent, mortgage rate, time horizon, transaction costs, home appreciation, and other assumptions. This calculator compares both choices using the same time period.
How many years should I stay before buying makes sense?
There is no universal minimum. Buying usually starts with substantial purchase and selling costs, so a longer stay can make it more competitive. The estimated break-even result shows when buying first becomes less costly under your assumptions.
What is the rent vs. buy break-even point?
It is the first modeled year when the net cost of buying is no greater than the net cost of renting. If no crossover occurs within 30 years, the calculator reports that the break-even point is beyond 30 years.
Does this calculator include home equity?
Yes. Estimated home equity is the projected home value minus the remaining mortgage balance. Estimated sale proceeds reduce the net cost of buying after selling costs are deducted.
Is the down payment treated as a cost?
The down payment is part of the initial cash required, but it also contributes to home equity. The model separately adds the estimated investment growth that the down payment and buying costs could have earned.
Does the comparison include closing costs?
Yes. Buying costs are entered as a percentage of the home price, and selling costs are deducted from the estimated sale proceeds. Use the Closing Costs Calculator for a more detailed upfront estimate.
What investment return should I use?
Use a conservative long-term return assumption that matches the alternative you would realistically choose for the initial cash. Investment returns are uncertain, and this model does not apply returns to every monthly cash-flow difference.
Are insurance and HOA fees included?
Yes. You can enter annual homeowners insurance, monthly HOA fees, and monthly renters insurance. Utilities and differences in other services are not included.
Are mortgage tax deductions included?
No. Tax benefits vary by jurisdiction and household circumstances, so this calculator does not estimate deductions or provide tax advice.