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Rent vs Buy Calculator

Enter the home price, loan and costs, your rent, and how long you will stay. The calculator compares what you would be worth after buying with what you would be worth if you rented and invested the difference.

Your numbers

An assumption you can change, not a forecast.

An assumption you can change, not a forecast.

Result

Estimate for information only, not professional advice. Last reviewed .

Tax year 2026. Tax figures last updated October 29, 2026. Sources.

How we calculate it

Buying: the home grows at the price growth rate. After the chosen years you sell, pay the selling costs and the remaining loan, and what is left is your equity. Every month you pay the loan payment, property tax, insurance and maintenance.

Renting: you invest the down payment and closing costs on day one at your investment return, and every month you also invest the difference between what owning would cost and your rent (or draw it down if rent is higher). Rent rises by the rent growth rate each year. The calculator compares the two wealth totals.

Assumptions and limits

  • A simple model. Property tax and insurance stay at their starting amounts, and the tax effects of owning (mortgage interest deduction, capital gains exclusion) and of investing are not included.
  • The answer is very sensitive to home price growth and your investment return, which are assumptions, not forecasts.
  • Non-financial reasons count too: stability, freedom to move, control of the home, and the risk of repairs.
  • Rent is compared with the full cost of owning, including maintenance, as many guides recommend.

Frequently asked questions

Is it better to rent or buy?

It depends on how long you stay, the price-to-rent ratio, mortgage rates and what you can earn investing. Staying five years or less usually favors renting because buying and selling costs are large.

What costs of owning do people forget?

Property tax, insurance, repairs and maintenance (often about 1% of the value each year), HOA dues and the cost of selling, often around 6%.

Why does the calculator invest the difference?

Buying puts money into a house. Renting leaves that money free to invest. To compare fairly, the renter invests the down payment and any monthly savings versus owning.

What is the break-even year?

It is the first year when your equity after selling costs is at least what the renter would have invested. It shows how long you need to stay for buying to pay off.

Related calculators

Worked example (a fixed example using the starting numbers, it does not change as you type)

Inputs: Home price ($) = 400000; Down payment (% of price) = 20; Mortgage rate (APR %) = 6.5; Loan term (years) = 30; Property tax (% of price per year) = 1.1; Home insurance ($ per year) = 1500; Maintenance (% of value per year) = 1; Home price growth per year (%) = 3; Closing costs when buying (%) = 3; Costs when selling (%) = 6; Monthly rent today ($) = 2200; Rent growth per year (%) = 3; Return on money you invest (% a year) = 6; Years you will stay = 10.

  • Result Buying wins
  • Buying leaves you with $234,028.95
  • Renting leaves you with $231,301.59
  • Buying is ahead by $2,727.36
  • Year buying pulls ahead Year 10
  • Monthly payment on the loan $2,022.62
  • Home value at the end $537,566.55
  • Loan balance at the end $271,283.60

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Last reviewed: . Formulas and assumptions are described on our methodology page. For information only; not professional advice.