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Rent vs. Buy Calculator

Updated January 2026

A rent vs buy calculator helps you make one of the biggest financial decisions of your life with data, not emotion. Compare the true total cost of each path over your expected time horizon, including opportunity cost and equity buildup.

How to Use This Calculator

Enter your monthly rent, expected annual rent increase, the home price you're considering, your down payment percentage, mortgage rate, and loan term. Add estimates for property taxes, insurance, maintenance, closing costs, appreciation, and your expected holding period. Click Calculate to see the total cost of each path and which is better for your situation.

How It's Calculated

The calculator compares total costs for each path:

Cost of Renting = Total rent payments + Opportunity cost of down payment

Cost of Buying = Total mortgage payments + Taxes + Insurance + Maintenance + Closing costs − Appreciation − Equity − Sale proceeds

The break-even year is the point where the cumulative cost of buying becomes less than the cumulative cost of renting, factoring in all costs including the opportunity cost of the down payment.

Frequently Asked Questions

The break-even point is typically 3-5 years, but it varies based on home prices, rent costs, interest rates, and how long you stay. Buying has high upfront costs (down payment, closing costs) that renting doesn't. Over time, the benefits of buying — building equity, fixed mortgage payments (vs. rising rent), and tax advantages — can outweigh those costs. The shorter your expected stay, the more renting makes sense. This calculator computes your exact break-even year based on your specific inputs.
Many first-time buyers underestimate ongoing ownership costs. Maintenance and repairs average 1% of home value annually — $5,000/year on a $500,000 home. Closing costs at purchase run 2–5% of the price. When you sell, realtor commissions are typically 5–6% of the sale price. Property taxes and insurance often increase yearly. Utility costs are usually higher for a house than an apartment. Homeowners association (HOA) fees can be significant. These costs add thousands that renters never deal with.
Yes, this calculator factors in the opportunity cost of your down payment — what that money could have earned if invested instead. For example, a $60,000 down payment invested at 7% annual return would grow to over $233,000 in 20 years. This is a real cost of buying that many simplistic calculators miss. By including it, we give you a more honest comparison between the two paths.
Beyond the numbers, consider your lifestyle and career stability. Buying ties you to a location — selling a home is expensive and time-consuming. Renting offers flexibility to move for a job, relationship, or lifestyle change. As a homeowner, you're responsible for all maintenance and repairs — a broken furnace or leaky roof is your problem, not a landlord's. Consider your tolerance for these responsibilities alongside the financial comparison.

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