Rent vs Buy Calculator

Rent vs Buy FAQ

How long until buying pays off?

The break-even point — when your home equity exceeds what you'd have accumulated by renting and investing — is typically 4–7 years in most US markets. If you plan to move sooner than that, renting is usually the financially smarter choice. Use the calculator above to find your exact break-even year.

What costs does this calculator include?

Buying costs: mortgage P&I, property taxes, home insurance, HOA, maintenance (default 1%/year), closing costs at purchase, and selling costs when you eventually sell. Renting costs: monthly rent (growing at your specified rate), renters insurance. The renter scenario assumes you invest the down payment and any monthly savings at the specified investment return rate.

Is renting throwing money away?

Not necessarily. Renters invest their down payment and may invest monthly savings — building wealth without the illiquidity of real estate. Homeowners build equity through appreciation and mortgage paydown but also face maintenance, taxes, and transaction costs. Both paths can build significant wealth over time.

What appreciation rate should I use?

The US national average home appreciation is approximately 3–4% per year over the long term, though it varies significantly by city. Use a conservative 2–3% for planning, or check your local Zillow market forecast. Note that past appreciation doesn't guarantee future results.

This calculator provides estimates for educational purposes. Consult a financial advisor for personalized guidance.