Rent vs Buy Calculator
Compare the real net cost of renting and buying over the years you plan to stay.
Net cost over 7 years
Over 7 years, buying comes out ahead by about $761 under these assumptions. Buying nets ~$187,867 of home equity after selling costs.
Net cost = total cash out minus the value you keep (home equity for buying, or the investment growth of your down payment for renting). Assumes ~7% selling costs. Illustrative only — not financial advice.
FAQ
Is it better to rent or buy a home?+
It depends on how long you will stay, local prices and rents, the mortgage rate, and what return you could earn investing your down payment instead. The longer you stay, the more buying tends to win, because purchase and selling costs get spread over more years and you build equity. This calculator compares the net cost of each over your time horizon.
What is the break-even point for buying?+
It is the number of years you must stay for buying to become cheaper than renting, once you account for closing and selling costs, equity, and the opportunity cost of your down payment. In many markets it lands around 5–7 years, but it is highly sensitive to rates, appreciation, and rent levels.
Why does the calculator ask for an investment return?+
If you rent instead of buying, your down payment stays invested. The growth on that money is a real benefit of renting, so we subtract it from renting’s cost to compare fairly against the equity you would build by owning.
What costs does buying include here?+
Down payment, monthly principal & interest, property tax, insurance, and ongoing maintenance — minus the home equity you keep after ~7% selling costs. Renting includes rent (growing with inflation) minus the investment growth on your down payment.