Rent or Buy Calculator

Your details

Your current (or expected) monthly rent payment.
Expected yearly rent increase (national average is around 3%).
%/yr
Monthly renter's insurance premium.
$/mo
Upfront deposit you pay when signing the lease (returned at move-out).
Purchase price of the home.
Down payment as a percentage of the home price. Under 20% usually triggers PMI.
%
Annual fixed interest rate on your mortgage.
%/yr
Length of the mortgage.
Typical closing costs when purchasing (lender fees, title, appraisal). Usually 2-5% of the purchase price.
%
Annual property tax as a percentage of home value. US average is about 1.1%.
%/yr
Monthly homeowner's insurance premium.
$/mo
Annual maintenance cost as a percentage of home value. The 1% rule is a common benchmark.
%/yr
Monthly homeowners association fee (if applicable).
$/mo
Private mortgage insurance rate, charged if down payment is under 20%. Usually 0.3-1.5% of the loan balance per year.
%/yr
Expected annual growth in home value. US long-run average is roughly 3-4% per year.
%/yr
Costs to sell (agent commission, transfer taxes, etc.). Often 5-8% of sale price.
%
How long you plan to live in the home. This is the most important variable in the comparison.
years
Expected annual return if you invest money not spent on a down payment or extra housing costs. A diversified stock index has historically returned ~7% real.
%/yr
Your marginal federal + state income tax rate. Used to compute the mortgage interest deduction benefit (only applies if you itemize).
%
If on, the calculator applies a tax deduction for mortgage interest paid. Only beneficial if your itemized deductions exceed the standard deduction.
Currency
RecommendationRent
Renting is cheaper over your time horizon

Which option costs less over your planned holding period

Total renting cost$128,632
Total buying cost$158,927
Net savings from better option$30,296
Breakeven pointYear 13
Monthly all-in buying cost$1,892
Monthly all-in renting cost$1,531
Projected home equity at sale$187,624
Down payment opportunity cost$147,732
Renting$130,163
Buying$160,819

Savings from best option: $30,296

  • Net total cost
  • Avg monthly cost
Total renting cost$128,632
Total buying cost$158,927
Home equity at sale$187,624
Invested down payment$147,732

Renting is cheaper over your time horizon

  • Over 7 years the cheaper option saves roughly $30,296 in net costs.
  • Buying builds an estimated $187,624 in home equity by the time you sell.
  • The $80,000 down payment would grow to about $147,732 if invested at your assumed return rate instead.
  • Buying typically becomes cheaper than renting around year 13 when the equity and appreciation start to offset higher upfront and carrying costs.

Next stepRun the calculator with your actual mortgage rate quote, local property tax rate, and planned years to stay for the most accurate comparison. The breakeven year is the single most important output: if you plan to move before it, renting is almost always cheaper.

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