Rent vs Buy Calculator

Is It Better to Rent or Buy?

The honest answer: it depends on how long you stay, what rates you qualify for, and what's happening in your local market. This calculator does the math so you don't have to guess.

The Breakeven Point Explained

Buying a home has high upfront costs — closing costs, down payment, maintenance — that renting doesn't. Over time, home equity and fixed payments make buying cheaper. The breakeven point is the year when buying's total net cost dips below what you would have paid in rent. If you plan to stay longer than that, buying is likely the better financial move.

What "Net Buy Cost" Means

We subtract the equity you build (principal paid down + home appreciation) from your total housing costs. This gives a realistic comparison with renting — because unlike rent, the money you put into a mortgage partially comes back to you as equity when you sell.

The Unrecoverable Costs of Owning a Home

Not every dollar you spend as a homeowner comes back to you. Mortgage interest is gone the moment you pay it — only the principal portion builds equity. Property taxes and homeowners insurance are pure ongoing costs with no return. Maintenance and repairs — budgeted here at roughly 1% of home value per year — keep the property livable but don't add value dollar-for-dollar. And closing costs (typically 2–3% of the purchase price) are spent the day you buy and never recovered. Renting has its own unrecoverable cost too — 100% of every rent payment — but it comes with no maintenance bill, no property tax bill, and no large upfront cash outlay.

Renting Isn't "Throwing Money Away"

Renting gives you flexibility, no maintenance costs, and keeps your savings liquid. If you plan to move in 2–3 years, renting is often the smarter financial choice even if buying "builds equity." The calculator shows you exactly where the line is for your numbers.

Why 5–7 Years Is the Typical Break-Even Horizon

Because closing costs and the early, interest-heavy years of a mortgage front-load the cost of buying, most homebuyers don't come out ahead of renting until somewhere around year 5 to year 7 — the exact point depends on your down payment, rate, local appreciation, and rent growth. Stay shorter than that and the upfront costs of buying rarely get recovered. Stay longer and the fixed mortgage payment plus accumulating equity typically pull ahead of ever-rising rent. Use the "Years to Stay" slider above to see your own break-even year rather than relying on the rule of thumb.

Ready to Buy? Start With Your Mortgage Estimate

Use our Mortgage Payment Calculator to see your exact monthly payment, then talk to an agent about homes in that range.