Is it better to rent or buy a house?

It depends on your time horizon, local prices, mortgage rates, taxes, HOA, maintenance, rent inflation, and your opportunity cost. This calculator compares total net cost over time.

How long should I plan to stay if I buy?

Many households use 5–7 years as a minimum because closing and selling costs are spread over more years. Shorter horizons tend to favor renting.

Rent vs Buy Calculator

Compare the true cost of renting vs buying a home—over any time horizon. We factor in mortgage, taxes, insurance, HOA, maintenance, appreciation, rent inflation, selling costs, and opportunity cost.

At a glance (example)

Example: On a $450,000 home with 20% down, a 30-year fixed at 6.75% APR, typical taxes/insurance/maintenance, and rent starting at $2,400/mo growing 3%/yr, buying often becomes cheaper after about 6–7 years. Your market may differ—adjust the inputs below.

Enter price, rent, APR, term, and time horizon to compare.

Your assumptions

Buying

Home price

Down payment

APR

Term

yrs

Buyer closing costs

Property tax rate

% / year

Insurance (per year)

HOA (per month)

Maintenance rate

% / year

Appreciation

% / year

Selling costs

Horizon

yrs

Renting

Current rent (per month)

Rent growth

Renter’s insurance (per month)

Comparison at horizon (8 years)

Total cost — Buy

$229,384

Total cost — Rent

$257,827

Cheaper option (Δ)

Buying $28,443

Monthly PITI+HOA (today)

$2,902

Monthly breakdown (today)

Buying

Principal & Interest

$2,335

(This month: principal $310 • interest $2,025)

Property tax

$450

Insurance

$117

HOA

Maintenance

$375

Total (incl. maint.)

$3,277

Renting

Rent

$2,400

Renter’s insurance

$18

Total

$2,418

Average monthly cost over time

Each point shows the average monthly cost if you move out after that many years (buy side is net of equity; rent side is gross).

30-year schedule — average cost by stay length

Staying length	Avg Buying Cost (Monthly)	Avg Buying Cost (Annual)	Avg Renting Cost (Monthly)	Avg Renting Cost (Annual)
1 year	$5,273	$63,271	$2,418	$29,016
Show how year 1 was calculated Buying — cumulative through year 1 Interest paid$24,183 Principal repaid$3,837 Property taxes$5,462 Insurance$1,400 HOA$0 Maintenance$4,551 Buyer closing costs$11,250 Selling costs$27,675 Less equity at exit− $105,087 Total (net)$63,271 Avg monthly (buy) = total ÷ (1×12) = $5,273 Renting — cumulative through year 1 Rent paid (with growth)$28,800 Renter’s insurance$216 Total (gross)$29,016 Avg monthly (rent) = total ÷ (1×12) = $2,418 This is always ≥ your first-year monthly rent + renter’s insurance.
2 years	$3,667	$44,005	$2,454	$29,448
Show how year 2 was calculated Buying — cumulative through year 2 Interest paid$48,098 Principal repaid$7,941 Property taxes$11,060 Insurance$2,800 HOA$0 Maintenance$9,216 Buyer closing costs$11,250 Selling costs$28,367 Less equity at exit− $120,722 Total (net)$88,010 Avg monthly (buy) = total ÷ (2×12) = $3,667 Renting — cumulative through year 2 Rent paid (with growth)$58,464 Renter’s insurance$432 Total (gross)$58,896 Avg monthly (rent) = total ÷ (2×12) = $2,454 This is always ≥ your first-year monthly rent + renter’s insurance.
3 years	$3,124	$37,483	$2,491	$29,889
Show how year 3 was calculated Buying — cumulative through year 3 Interest paid$71,728 Principal repaid$12,330 Property taxes$16,798 Insurance$4,200 HOA$0 Maintenance$13,998 Buyer closing costs$11,250 Selling costs$29,076 Less equity at exit− $136,931 Total (net)$112,449 Avg monthly (buy) = total ÷ (3×12) = $3,124 Renting — cumulative through year 3 Rent paid (with growth)$89,018 Renter’s insurance$648 Total (gross)$89,666 Avg monthly (rent) = total ÷ (3×12) = $2,491 This is always ≥ your first-year monthly rent + renter’s insurance.
4 years	$2,845	$34,142	$2,528	$30,338
Show how year 4 was calculated Buying — cumulative through year 4 Interest paid$95,052 Principal repaid$17,025 Property taxes$22,679 Insurance$5,600 HOA$0 Maintenance$18,899 Buyer closing costs$11,250 Selling costs$29,803 Less equity at exit− $153,741 Total (net)$136,568 Avg monthly (buy) = total ÷ (4×12) = $2,845 Renting — cumulative through year 4 Rent paid (with growth)$120,488 Renter’s insurance$864 Total (gross)$121,352 Avg monthly (rent) = total ÷ (4×12) = $2,528 This is always ≥ your first-year monthly rent + renter’s insurance.
5 years	$2,672	$32,069	$2,566	$30,797
Show how year 5 was calculated Buying — cumulative through year 5 Interest paid$118,050 Principal repaid$22,047 Property taxes$28,708 Insurance$7,000 HOA$0 Maintenance$23,923 Buyer closing costs$11,250 Selling costs$30,548 Less equity at exit− $171,181 Total (net)$160,345 Avg monthly (buy) = total ÷ (5×12) = $2,672 Renting — cumulative through year 5 Rent paid (with growth)$152,903 Renter’s insurance$1,080 Total (gross)$153,983 Avg monthly (rent) = total ÷ (5×12) = $2,566 This is always ≥ your first-year monthly rent + renter’s insurance.
6 years	$2,552	$30,626	$2,605	$31,264
Show how year 6 was calculated Buying — cumulative through year 6 Interest paid$140,697 Principal repaid$27,419 Property taxes$34,887 Insurance$8,400 HOA$0 Maintenance$29,073 Buyer closing costs$11,250 Selling costs$31,312 Less equity at exit− $189,281 Total (net)$183,757 Avg monthly (buy) = total ÷ (6×12) = $2,552 Renting — cumulative through year 6 Rent paid (with growth)$186,290 Renter’s insurance$1,296 Total (gross)$187,586 Avg monthly (rent) = total ÷ (6×12) = $2,605 This is always ≥ your first-year monthly rent + renter’s insurance.
7 years	$2,462	$29,540	$2,645	$31,742
Show how year 7 was calculated Buying — cumulative through year 7 Interest paid$162,971 Principal repaid$33,165 Property taxes$41,221 Insurance$9,800 HOA$0 Maintenance$34,351 Buyer closing costs$11,250 Selling costs$32,095 Less equity at exit− $208,074 Total (net)$206,779 Avg monthly (buy) = total ÷ (7×12) = $2,462 Renting — cumulative through year 7 Rent paid (with growth)$220,679 Renter’s insurance$1,512 Total (gross)$222,191 Avg monthly (rent) = total ÷ (7×12) = $2,645 This is always ≥ your first-year monthly rent + renter’s insurance.
8 years	$2,389	$28,673	$2,686	$32,228
Show how year 8 was calculated Buying — cumulative through year 8 Interest paid$184,844 Principal repaid$39,311 Property taxes$47,713 Insurance$11,200 HOA$0 Maintenance$39,761 Buyer closing costs$11,250 Selling costs$32,897 Less equity at exit− $227,592 Total (net)$229,384 Avg monthly (buy) = total ÷ (8×12) = $2,389 Renting — cumulative through year 8 Rent paid (with growth)$256,099 Renter’s insurance$1,728 Total (gross)$257,827 Avg monthly (rent) = total ÷ (8×12) = $2,686 This is always ≥ your first-year monthly rent + renter’s insurance.
9 years	$2,329	$27,949	$2,727	$32,725
Show how year 9 was calculated Buying — cumulative through year 9 Interest paid$206,290 Principal repaid$45,885 Property taxes$54,368 Insurance$12,600 HOA$0 Maintenance$45,306 Buyer closing costs$11,250 Selling costs$33,719 Less equity at exit− $247,873 Total (net)$251,545 Avg monthly (buy) = total ÷ (9×12) = $2,329 Renting — cumulative through year 9 Rent paid (with growth)$292,582 Renter’s insurance$1,944 Total (gross)$294,526 Avg monthly (rent) = total ÷ (9×12) = $2,727 This is always ≥ your first-year monthly rent + renter’s insurance.
10 years	$2,277	$27,323	$2,769	$33,232
Show how year 10 was calculated Buying — cumulative through year 10 Interest paid$227,278 Principal repaid$52,916 Property taxes$61,188 Insurance$14,000 HOA$0 Maintenance$50,990 Buyer closing costs$11,250 Selling costs$34,562 Less equity at exit− $268,954 Total (net)$273,231 Avg monthly (buy) = total ÷ (10×12) = $2,277 Renting — cumulative through year 10 Rent paid (with growth)$330,160 Renter’s insurance$2,160 Total (gross)$332,320 Avg monthly (rent) = total ÷ (10×12) = $2,769 This is always ≥ your first-year monthly rent + renter’s insurance.
11 years	$2,230	$26,765	$2,812	$33,749
Show how year 11 was calculated Buying — cumulative through year 11 Interest paid$247,776 Principal repaid$60,438 Property taxes$68,180 Insurance$15,400 HOA$0 Maintenance$56,816 Buyer closing costs$11,250 Selling costs$35,426 Less equity at exit− $290,877 Total (net)$294,410 Avg monthly (buy) = total ÷ (11×12) = $2,230 Renting — cumulative through year 11 Rent paid (with growth)$368,865 Renter’s insurance$2,376 Total (gross)$371,241 Avg monthly (rent) = total ÷ (11×12) = $2,812 This is always ≥ your first-year monthly rent + renter’s insurance.
12 years	$2,188	$26,254	$2,856	$34,277
Show how year 12 was calculated Buying — cumulative through year 12 Interest paid$267,751 Principal repaid$68,482 Property taxes$75,346 Insurance$16,800 HOA$0 Maintenance$62,788 Buyer closing costs$11,250 Selling costs$36,312 Less equity at exit− $313,682 Total (net)$315,047 Avg monthly (buy) = total ÷ (12×12) = $2,188 Renting — cumulative through year 12 Rent paid (with growth)$408,730 Renter’s insurance$2,592 Total (gross)$411,322 Avg monthly (rent) = total ÷ (12×12) = $2,856 This is always ≥ your first-year monthly rent + renter’s insurance.
13 years	$2,148	$25,777	$2,901	$34,815
Show how year 13 was calculated Buying — cumulative through year 13 Interest paid$287,165 Principal repaid$77,087 Property taxes$82,691 Insurance$18,200 HOA$0 Maintenance$68,909 Buyer closing costs$11,250 Selling costs$37,220 Less equity at exit− $337,417 Total (net)$335,105 Avg monthly (buy) = total ÷ (13×12) = $2,148 Renting — cumulative through year 13 Rent paid (with growth)$449,792 Renter’s insurance$2,808 Total (gross)$452,600 Avg monthly (rent) = total ÷ (13×12) = $2,901 This is always ≥ your first-year monthly rent + renter’s insurance.
14 years	$2,110	$25,325	$2,947	$35,365
Show how year 14 was calculated Buying — cumulative through year 14 Interest paid$305,981 Principal repaid$86,292 Property taxes$90,220 Insurance$19,600 HOA$0 Maintenance$75,183 Buyer closing costs$11,250 Selling costs$38,150 Less equity at exit− $362,130 Total (net)$354,546 Avg monthly (buy) = total ÷ (14×12) = $2,110 Renting — cumulative through year 14 Rent paid (with growth)$492,086 Renter’s insurance$3,024 Total (gross)$495,110 Avg monthly (rent) = total ÷ (14×12) = $2,947 This is always ≥ your first-year monthly rent + renter’s insurance.
15 years	$2,074	$24,888	$2,994	$35,926
Show how year 15 was calculated Buying — cumulative through year 15 Interest paid$324,155 Principal repaid$96,136 Property taxes$97,937 Insurance$21,000 HOA$0 Maintenance$81,614 Buyer closing costs$11,250 Selling costs$39,104 Less equity at exit− $387,871 Total (net)$373,326 Avg monthly (buy) = total ÷ (15×12) = $2,074 Renting — cumulative through year 15 Rent paid (with growth)$535,649 Renter’s insurance$3,240 Total (gross)$538,889 Avg monthly (rent) = total ÷ (15×12) = $2,994 This is always ≥ your first-year monthly rent + renter’s insurance.
16 years	$2,039	$24,463	$3,042	$36,498
Show how year 16 was calculated Buying — cumulative through year 16 Interest paid$341,644 Principal repaid$106,667 Property taxes$105,847 Insurance$22,400 HOA$0 Maintenance$88,206 Buyer closing costs$11,250 Selling costs$40,082 Less equity at exit− $414,695 Total (net)$391,401 Avg monthly (buy) = total ÷ (16×12) = $2,039 Renting — cumulative through year 16 Rent paid (with growth)$580,518 Renter’s insurance$3,456 Total (gross)$583,974 Avg monthly (rent) = total ÷ (16×12) = $3,042 This is always ≥ your first-year monthly rent + renter’s insurance.
17 years	$2,004	$24,042	$3,090	$37,083
Show how year 17 was calculated Buying — cumulative through year 17 Interest paid$358,400 Principal repaid$117,931 Property taxes$113,955 Insurance$23,800 HOA$0 Maintenance$94,962 Buyer closing costs$11,250 Selling costs$41,084 Less equity at exit− $442,659 Total (net)$408,722 Avg monthly (buy) = total ÷ (17×12) = $2,004 Renting — cumulative through year 17 Rent paid (with growth)$626,734 Renter’s insurance$3,672 Total (gross)$630,406 Avg monthly (rent) = total ÷ (17×12) = $3,090 This is always ≥ your first-year monthly rent + renter’s insurance.
18 years	$1,969	$23,624	$3,140	$37,679
Show how year 18 was calculated Buying — cumulative through year 18 Interest paid$374,371 Principal repaid$129,979 Property taxes$122,265 Insurance$25,200 HOA$0 Maintenance$101,888 Buyer closing costs$11,250 Selling costs$42,111 Less equity at exit− $471,825 Total (net)$425,239 Avg monthly (buy) = total ÷ (18×12) = $1,969 Renting — cumulative through year 18 Rent paid (with growth)$674,336 Renter’s insurance$3,888 Total (gross)$678,224 Avg monthly (rent) = total ÷ (18×12) = $3,140 This is always ≥ your first-year monthly rent + renter’s insurance.
19 years	$1,934	$23,205	$3,191	$38,288
Show how year 19 was calculated Buying — cumulative through year 19 Interest paid$389,504 Principal repaid$142,865 Property taxes$130,783 Insurance$26,600 HOA$0 Maintenance$108,986 Buyer closing costs$11,250 Selling costs$43,164 Less equity at exit− $502,258 Total (net)$440,895 Avg monthly (buy) = total ÷ (19×12) = $1,934 Renting — cumulative through year 19 Rent paid (with growth)$723,366 Renter’s insurance$4,104 Total (gross)$727,470 Avg monthly (rent) = total ÷ (19×12) = $3,191 This is always ≥ your first-year monthly rent + renter’s insurance.
20 years	$1,898	$22,782	$3,242	$38,909
Show how year 20 was calculated Buying — cumulative through year 20 Interest paid$403,739 Principal repaid$156,650 Property taxes$139,515 Insurance$28,000 HOA$0 Maintenance$116,262 Buyer closing costs$11,250 Selling costs$44,243 Less equity at exit− $534,027 Total (net)$455,631 Avg monthly (buy) = total ÷ (20×12) = $1,898 Renting — cumulative through year 20 Rent paid (with growth)$773,867 Renter’s insurance$4,320 Total (gross)$778,187 Avg monthly (rent) = total ÷ (20×12) = $3,242 This is always ≥ your first-year monthly rent + renter’s insurance.
21 years	$1,863	$22,352	$3,295	$39,544
Show how year 21 was calculated Buying — cumulative through year 21 Interest paid$417,015 Principal repaid$171,393 Property taxes$148,464 Insurance$29,400 HOA$0 Maintenance$123,720 Buyer closing costs$11,250 Selling costs$45,349 Less equity at exit− $567,205 Total (net)$469,386 Avg monthly (buy) = total ÷ (21×12) = $1,863 Renting — cumulative through year 21 Rent paid (with growth)$825,883 Renter’s insurance$4,536 Total (gross)$830,419 Avg monthly (rent) = total ÷ (21×12) = $3,295 This is always ≥ your first-year monthly rent + renter’s insurance.
22 years	$1,826	$21,913	$3,349	$40,191
Show how year 22 was calculated Buying — cumulative through year 22 Interest paid$429,264 Principal repaid$187,164 Property taxes$157,637 Insurance$30,800 HOA$0 Maintenance$131,364 Buyer closing costs$11,250 Selling costs$46,482 Less equity at exit− $601,871 Total (net)$482,091 Avg monthly (buy) = total ÷ (22×12) = $1,826 Renting — cumulative through year 22 Rent paid (with growth)$879,459 Renter’s insurance$4,752 Total (gross)$884,211 Avg monthly (rent) = total ÷ (22×12) = $3,349 This is always ≥ your first-year monthly rent + renter’s insurance.
23 years	$1,789	$21,464	$3,404	$40,853
Show how year 23 was calculated Buying — cumulative through year 23 Interest paid$440,415 Principal repaid$204,032 Property taxes$167,040 Insurance$32,200 HOA$0 Maintenance$139,200 Buyer closing costs$11,250 Selling costs$47,644 Less equity at exit− $638,107 Total (net)$493,674 Avg monthly (buy) = total ÷ (23×12) = $1,789 Renting — cumulative through year 23 Rent paid (with growth)$934,643 Renter’s insurance$4,968 Total (gross)$939,611 Avg monthly (rent) = total ÷ (23×12) = $3,404 This is always ≥ your first-year monthly rent + renter’s insurance.
24 years	$1,750	$21,002	$3,461	$41,528
Show how year 24 was calculated Buying — cumulative through year 24 Interest paid$450,391 Principal repaid$222,076 Property taxes$176,677 Insurance$33,600 HOA$0 Maintenance$147,231 Buyer closing costs$11,250 Selling costs$48,836 Less equity at exit− $676,002 Total (net)$504,059 Avg monthly (buy) = total ÷ (24×12) = $1,750 Renting — cumulative through year 24 Rent paid (with growth)$991,482 Renter’s insurance$5,184 Total (gross)$996,666 Avg monthly (rent) = total ÷ (24×12) = $3,461 This is always ≥ your first-year monthly rent + renter’s insurance.
25 years	$1,711	$20,526	$3,518	$42,217
Show how year 25 was calculated Buying — cumulative through year 25 Interest paid$459,111 Principal repaid$241,375 Property taxes$186,556 Insurance$35,000 HOA$0 Maintenance$155,463 Buyer closing costs$11,250 Selling costs$50,056 Less equity at exit− $715,650 Total (net)$513,162 Avg monthly (buy) = total ÷ (25×12) = $1,711 Renting — cumulative through year 25 Rent paid (with growth)$1,050,027 Renter’s insurance$5,400 Total (gross)$1,055,427 Avg monthly (rent) = total ÷ (25×12) = $3,518 This is always ≥ your first-year monthly rent + renter’s insurance.
26 years	$1,670	$20,034	$3,577	$42,921
Show how year 26 was calculated Buying — cumulative through year 26 Interest paid$466,487 Principal repaid$262,018 Property taxes$196,682 Insurance$36,400 HOA$0 Maintenance$163,901 Buyer closing costs$11,250 Selling costs$51,308 Less equity at exit− $757,150 Total (net)$520,896 Avg monthly (buy) = total ÷ (26×12) = $1,670 Renting — cumulative through year 26 Rent paid (with growth)$1,110,328 Renter’s insurance$5,616 Total (gross)$1,115,944 Avg monthly (rent) = total ÷ (26×12) = $3,577 This is always ≥ your first-year monthly rent + renter’s insurance.
27 years	$1,627	$19,525	$3,637	$43,640
Show how year 27 was calculated Buying — cumulative through year 27 Interest paid$472,426 Principal repaid$284,098 Property taxes$207,060 Insurance$37,800 HOA$0 Maintenance$172,550 Buyer closing costs$11,250 Selling costs$52,591 Less equity at exit− $800,608 Total (net)$527,167 Avg monthly (buy) = total ÷ (27×12) = $1,627 Renting — cumulative through year 27 Rent paid (with growth)$1,172,437 Renter’s insurance$5,832 Total (gross)$1,178,269 Avg monthly (rent) = total ÷ (27×12) = $3,637 This is always ≥ your first-year monthly rent + renter’s insurance.
28 years	$1,583	$18,995	$3,698	$44,374
Show how year 28 was calculated Buying — cumulative through year 28 Interest paid$476,828 Principal repaid$307,716 Property taxes$217,698 Insurance$39,200 HOA$0 Maintenance$181,415 Buyer closing costs$11,250 Selling costs$53,905 Less equity at exit− $846,139 Total (net)$531,874 Avg monthly (buy) = total ÷ (28×12) = $1,583 Renting — cumulative through year 28 Rent paid (with growth)$1,236,411 Renter’s insurance$6,048 Total (gross)$1,242,459 Avg monthly (rent) = total ÷ (28×12) = $3,698 This is always ≥ your first-year monthly rent + renter’s insurance.
29 years	$1,537	$18,445	$3,760	$45,123
Show how year 29 was calculated Buying — cumulative through year 29 Interest paid$479,585 Principal repaid$332,979 Property taxes$228,602 Insurance$40,600 HOA$0 Maintenance$190,502 Buyer closing costs$11,250 Selling costs$55,253 Less equity at exit− $893,862 Total (net)$534,909 Avg monthly (buy) = total ÷ (29×12) = $1,537 Renting — cumulative through year 29 Rent paid (with growth)$1,302,303 Renter’s insurance$6,264 Total (gross)$1,308,567 Avg monthly (rent) = total ÷ (29×12) = $3,760 This is always ≥ your first-year monthly rent + renter’s insurance.
30 years	$1,489	$17,872	$3,824	$45,888
Show how year 30 was calculated Buying — cumulative through year 30 Interest paid$480,583 Principal repaid$360,000 Property taxes$239,779 Insurance$42,000 HOA$0 Maintenance$199,816 Buyer closing costs$11,250 Selling costs$56,634 Less equity at exit− $943,905 Total (net)$536,157 Avg monthly (buy) = total ÷ (30×12) = $1,489 Renting — cumulative through year 30 Rent paid (with growth)$1,370,172 Renter’s insurance$6,480 Total (gross)$1,376,652 Avg monthly (rent) = total ÷ (30×12) = $3,824 This is always ≥ your first-year monthly rent + renter’s insurance.

Results interpretation

Short stays (≤4 years): Closing & selling costs dominate—renting often wins unless rent inflation is very high.
Medium stays (5–8 years): Appreciation, equity paydown, and fixed payments can tip toward buying.
High taxes/maintenance tilt toward renting; fast rent growth tilts toward buying.
Who it’s for: shoppers comparing realistic total cost vs flexibility.

How this calculator works

Formula, steps & assumptions

We compare the net total cost of buying vs the gross total cost of renting over your horizon. Buy side = down + buyer closing + monthly P&I + taxes + insurance + HOA + maintenance + selling costs − equity at exit. Rent side = rent (with annual growth) + renter’s insurance. We do not subtract any investment returns.

Property tax & maintenance scale with the appreciated home value each month; insurance & HOA are held flat. Loan amortization is tracked monthly. Treat results as planning estimates; local taxes/PMI/credits vary.

Rent vs Buy — FAQ

How long should I plan to stay?

Many households use 5–7 years as a guide. Closing & selling costs spread over more years improve the buy case.

Do I count appreciation?

Yes—expected home appreciation increases equity and can shift the comparison toward buying.

What about rent increases?

Use the rent growth input. Faster rent growth makes renting costlier over time, often favoring buying.

Is maintenance included?

We include an annual maintenance % of home value; it’s a large swing factor in real-world ownership.

What is “opportunity cost” here?

If you rent, you can invest the down payment + closing costs. We credit renting with that future value.

Are tax deductions assumed?

No—kept conservative. If you itemize deductions, your after-tax homeowner cost could be slightly lower.

Rent vs Buy Calculator: A Practical Guide to Choosing the Right Path for Your Home and Finances

Use our Rent vs Buy Calculator to compare the full, long-term cost of renting versus owning a home. The goal isn’t to “win” a debate—it’s to make a resilient decision that holds up when life changes or markets swing. Below you’ll find a step-by-step framework for reading the results, stress-testing assumptions, and deciding whether you should rent or buy based on your time horizon, local prices, mortgage rate, property taxes, maintenance, HOA dues, expected appreciation, rent inflation, and the opportunity cost of investing your cash instead of tying it up in a down payment.

How to read your results

Focus first on the green results banner: it tells you which option is cheaper over your selected horizon and by how much. The comparison is net of equity for buyers and net of the future value of invested cash for renters. If the difference is small, prioritize non-financial factors—flexibility, location options, school choices, space needs, and your appetite for maintenance surprises.

The chart shows the average monthly cost at each possible move-out year. Look for the breakeven point—the year where the “Buy” curve dips below “Rent.” Early years often favor renting because closing costs and potential selling costs haven’t had time to spread out. Longer horizons tend to favor buying because principal paydown and modest home appreciation build equity while rent continues to rise.

What costs are included?

On the buy side we include: down payment, buyer closing costs, monthly principal and interest (amortized), property taxes, homeowners insurance, HOA dues, maintenance (as a percent of home value), selling costs at the end, and the equity you keep after paying off the remaining loan. Taxes and maintenance scale with the appreciated value of the home; insurance and HOA are treated as level for simplicity.

On the rent side we include: all rent payments with annual rent growth, renter’s insurance, and the future value of the cash you did not spend on a down payment or buyer closing costs (your opportunity cost). This credit is a big reason short horizons frequently lean toward renting.

When buying tends to win

Time horizon ≥ 5–7 years. Closing and selling costs are spread over more years.
Stable or rising market. Even modest appreciation (2–3%/yr) adds up, especially with leverage.
Rent inflation is persistent. Fast rent growth pushes the rent curve higher each year.
Fixed payments fit your budget. A predictable mortgage can be easier to plan around than variable rent.

When renting tends to win

Short horizon (≤ 4 years). Transaction costs dominate; renting avoids them.
High maintenance/tax burden. Older homes, large lots, or high-tax areas tilt the math.
Better returns elsewhere. If you can earn strong, reliable returns on invested cash, renting can be efficient.
You need flexibility. Career moves, new family needs, or uncertain plans favor a lease.

Essential pre-buy checklist

If your results say buying is cheaper, make sure the decision fits your broader financial plan:

Emergency fund: 3–6 months of expenses after your down payment and closing costs.
DTI & pre-approval: Verify your debt-to-income ratio and lock a realistic rate quote.
Inspection & reserves: Budget for near-term repairs (roof, HVAC, plumbing, foundation).
All-in monthly: Compare mortgage P&I + tax + insurance + HOA + maintenance with comfort, not just maximum approval.
Exit plan: Understand selling costs, local liquidity, and the rentability of the property if you need to move.

How to stress-test your assumptions

Decisions are stronger when they survive “what-ifs.” Slide the inputs ±10–20% and confirm the outcome. Ask: What if appreciation is 0%? What if maintenance runs 1.5–2% of value? What if rent growth slows? What if your investment return is lower? If the decision stays the same under several scenarios, it’s likely robust.

Advanced questions people ask

PMI and low down payments. If you put less than 20% down, add private mortgage insurance to the monthly cost until you reach 20% equity; the calculator’s maintenance/tax/HOA fields already capture most ongoing costs, but PMI can be material—check your lender quote.

ARMs vs fixed rates. Adjustable-rate mortgages can reduce early payments but add interest-rate risk. If you expect to move before an ARM adjusts, it can narrow the rent vs buy gap; otherwise, model the worst-case adjustment.

Points and refinancing. Buying points lowers your rate up front, but only pays off if you stay long enough. If you plan to refinance, remember there are new closing costs—update the model accordingly.

Taxes and itemizing. We keep the comparison conservative by not assuming mortgage interest or property tax deductions. If you itemize, your after-tax homeowner cost may be a bit lower than shown.

Lifestyle matters as much as math

Housing is shelter first, investment second. Buying can unlock renovations, pets, and long-term neighborhood roots; renting delivers flexibility, simpler maintenance, and access to locations where buying would stretch your budget. If the calculator shows a small cost difference, let these qualitative factors lead the choice.

Example frameworks to decide

Short-term professional: If you might relocate within three years and the banner shows a small advantage for buying, default to renting unless you have a credible plan to house-hack or keep the property as a rental.

Growing family: If schools, space, and stability are top priorities and the model shows buying becomes cheaper around year six, consider purchasing sooner and keeping a healthy reserve for maintenance surprises.

Investor mindset: If your down payment could earn reliably elsewhere, use the rent growth and investment return fields to compare outcomes directly—sometimes renting and investing wins even when appreciation is solid.

Frequently misunderstood points

“Rent is 100% wasted”—and so are interest, taxes, insurance, HOA, and selling costs on the buy side. Equity is the difference.
“Real estate always appreciates.” It doesn’t. Local cycles exist; use conservative assumptions and stress-test.
“My rate is all that matters.” Rate is one lever. Taxes, maintenance, and time horizon can move the result just as much.

Methodology summary

We simulate loan amortization monthly, scale property taxes and maintenance with home value, hold insurance and HOA flat, apply selling costs at exit, and net out homeowner equity. For renting, we escalate rent, add renter’s insurance, and credit the future value of the down payment and buyer closing costs invested at your chosen return. The output is a net total cost for each path and an average monthly cost by stay length to help you see the breakeven year. Treat results as planning estimates—not advice specific to your tax situation or market.

Bottom line

The best decision is the one that still makes sense when the assumptions move around. Use this Rent vs Buy Calculator to anchor the math, then layer on your values: how much flexibility you need, how much risk you want to carry, and where you’ll be happiest living day to day. If you can say “I’d make the same call if appreciation were 1% lower and maintenance 1% higher,” you’re in high-confidence territory.