Rent vs Buy Calculator

Should you keep renting or buy a home? Enter the numbers for both, and see which leaves you with more net worth after the years you plan to stay, plus the break-even year.

Buying

Renting and investing

Better choice
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Break-even year–
Monthly mortgage (P&I)–
Net worth if you buy–
Net worth if you rent–
Total paid to own–
Total rent paid–

How the rent vs buy comparison works

Comparing a rent check with a mortgage payment is misleading, because owning has extra costs (tax, insurance, repairs, closing and selling costs) and builds equity, while renting leaves your down payment free to invest. This calculator follows both paths month by month:

  • The buyer pays the down payment and closing costs, then the mortgage, property tax, insurance, HOA and maintenance. The home grows in value each year.
  • The renter invests the down payment and closing costs on day one, pays rent (rising each year) and renter's insurance.
  • Each month, whoever pays less invests the difference at your investment return.
  • At the end, the buyer sells: net worth is the home value minus selling costs and the loan balance, plus investments.

Rules of thumb

  • The 5-year rule: buying rarely wins if you will move within about five years, because buying and selling costs can reach 8% to 10% of the price.
  • Price-to-rent ratio: divide the home price by a year of rent for a similar place. Above about 20, renting is often cheaper; below about 15, buying often makes sense.
  • The 5% rule: estimate the yearly unrecoverable cost of owning as about 5% of the price (1% tax, 1% maintenance, 3% cost of capital). If rent is lower than that divided by 12, renting may be the better deal.

Things the numbers don't capture

Owning gives you stability, freedom to renovate and protection from rent increases. Renting gives flexibility to move for a job and no surprise repair bills. Both matter as much as the math. To check what you can afford, try the home affordability calculator, the mortgage calculator or the rent affordability calculator.

Last reviewed October 2026.

Frequently asked questions

Is it better to rent or buy a house?

It depends mostly on how long you will stay, how home prices and rents change, and what your savings would earn if you did not buy. Buying has large upfront and selling costs, so it usually pays off only if you stay several years. This calculator finds the year when buying starts to beat renting under your assumptions.

How does the calculator compare renting and buying fairly?

It tracks the net worth of a buyer and a renter. The renter invests the down payment and closing costs instead. Each month, whoever has the lower housing cost invests the difference. The buyer's net worth is the home value minus selling costs and the remaining mortgage, plus their investments.

What is the break-even year?

It is the first year in which the buyer's net worth is equal to or higher than the renter's. If you plan to move before that year, renting is likely the better money choice under these assumptions.

What costs of owning are included?

Mortgage principal and interest, property tax, homeowners insurance, HOA dues and maintenance, plus closing costs when you buy and selling costs (agent commissions and fees) when you sell. Tax deductions are not included, because most homeowners now take the standard deduction.

Which assumptions matter most?

Home price growth, rent growth and investment return make the biggest difference over long periods. Try a few scenarios, for example home prices growing 2% instead of 4%, to see how sensitive the answer is.