Rent vs Buy Calculator

Compare total lifetime cost of renting vs buying a home over your expected time horizon.

Interactive Calculator Coming Soon

The interactive version of this calculator is under development. In the meantime, you can use the formula and worked examples below to calculate manually.

Scroll down to see the formula, step-by-step explanation, and FAQs.

Rent vs Buy Calculator Formula & How It Works

Buy Total Cost = Mortgage + Taxes + Insurance + Maintenance − Appreciation − Equity
  • Rent Total Cost = Rent Payments × 12 × Years + Rent Increases
  • Opportunity Cost = Down Payment × Expected Investment Return
  • Buy includes: closing costs, property tax, insurance, maintenance (~1%/year)
  • Buy benefit: home appreciation + equity build-up + tax deductions

The rent vs buy decision depends heavily on how long you stay, local home appreciation rates, investment return alternatives, and tax situation. Buying typically wins after 5–7 years in appreciating markets. Renting can be smarter in flat markets or short time horizons.

Rent vs Buy Calculator FAQs

Is it better to rent or buy a home?

Buying wins financially if: you stay 5+ years, prices appreciate at a healthy rate, and you build equity. Renting wins if: you may move soon, prices are very high relative to rent, or you can invest the down payment for higher returns.

What is the break-even point for buying vs renting?

The break-even point is when accumulated home equity plus savings on rent exceeds the total cost of buying (down payment, closing costs, taxes, maintenance). This is typically 3–7 years depending on market conditions.

Does renting help you save money?

Renting frees up capital that would go into a down payment — if invested wisely, this can generate competitive returns. However, rent doesn't build equity and is subject to increases. Compare both paths with realistic assumptions.

Related Calculators

Mortgage Calculator

Find your monthly mortgage payment and total interest for any home loan amount, rate, and term.

House Affordability Calculator

Find the maximum home price you can comfortably afford based on your income and debts.

Rent Calculator

Find out how much rent you can afford based on your monthly income and budget.

Investment Calculator

Project the future value of your investments including regular contributions and compound growth.