Rent vs. Buy Calculator
Renting or buying? This compares the net cost of each over your time horizon, counting the equity and appreciation you gain by owning.
Free to use No sign-up needed Updates as you type
Default interest rate: 7.18% — Freddie Mac 30-year fixed average, week of Nov 5, 2026. Enter the rate from your own Loan Estimate.
How the rent vs. buy calculator works
Renting versus buying is rarely as simple as comparing rent to a mortgage payment, and this calculator refuses to pretend otherwise. It tallies the true cost of owning — payment, property tax, insurance, maintenance, and closing costs — against the true cost of renting over the same span, then credits ownership with the equity you build and the appreciation you capture.
It also charges buying with the opportunity cost of locking up your down payment instead of investing it. The output is a break-even horizon: the number of years you'd need to stay before buying pulls ahead of renting.
Worked example: with home price of $350,000, down payment of 20.00% and mortgage rate of 7.18%, the home rent vs buy calculator shows cheaper over 7 years of Buying.
- Net cost of buying
- $141,873
- Total cost of renting
- $174,704
- Home value at end
- $430,456
- Equity recovered
- $148,709
| Years you’ll stay | Buy (net) | Rent |
|---|---|---|
| 2 | $58,290 | $46,284 |
| 3 | $76,160 | $70,473 |
| 5 | $110,227 | $121,048 |
| 10 | $184,252 | $261,376 |
The better choice flips around 5 — Buy (net) wins on one side, Rent on the other.
The formula
Net cost of buying = payments + taxes + insurance + maintenance + closing and selling costs − home equity gained − price appreciation. Net cost of renting = total rent paid + lost return forgone on the down payment had it stayed invested. Break-even is the year at which cumulative buying cost first drops below cumulative renting cost.
How every calculator here computes, what it assumes and how the defaults stay current: our methodology.
- Results hinge on assumed home appreciation, rent inflation, and investment return — small changes in these swing the break-even sharply.
- Maintenance is easy to underestimate; a common planning figure is roughly 1% of home value per year, more for older homes.
- Tax benefits depend on whether you itemize; for many buyers the standard deduction wins and the interest write-off adds nothing.
- Transaction costs are real and front-loaded — buying and later selling can consume 8–10% of value, which short stays never recover.
- The model ignores lifestyle value, mobility, and risk tolerance, which often matter as much as the dollar break-even point.
Results are estimates for educational purposes and are not financial advice. Confirm exact figures with your lender or a licensed advisor.
Questions about the rent vs. buy calculator
What is the break-even horizon and why does it matter?
It's the number of years you must own before the total cost of buying falls below the total cost of renting the same home. Below that horizon, the upfront closing costs and tied-up down payment make renting cheaper.
Above it, equity and appreciation tip the balance — so your expected length of stay largely decides the answer.
Why does the calculator charge buying for the down payment as an opportunity cost?
Because money used for a down payment can't simultaneously be invested elsewhere. A fair comparison assumes a renter invests that same lump sum and earns a return on it.
Counting the forgone return as a cost of buying — and a benefit of renting — keeps both paths on equal footing rather than quietly favoring ownership.
Does buying always win if I stay long enough?
Usually, but not guaranteed. Long ownership amortizes the heavy transaction costs and lets equity and appreciation compound, which is why time favors buying. But weak appreciation, high maintenance, or strong investment returns on the alternative can keep renting ahead for years. The break-even reflects your specific inputs, not a universal rule.
Is my information saved or shared?
No. Every calculation runs entirely in your browser. We never store, transmit or sell the numbers you enter.
Is it cheaper to rent or buy?
It depends on how long you stay, local prices versus rents, and what your down payment could earn elsewhere. Buying usually wins the longer you stay, once appreciation and equity outweigh the upfront closing costs. This calculator finds the break-even year for your numbers.
Sources
How the figures on this site are calculated and tested: methodology · editorial policy.
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