General
Rent vs Buy Calculator
Compare the total cost of renting versus buying a home over your chosen time horizon, including opportunity cost of your down payment and property appreciation.
Renting
Buying
Enter your rent and home purchase details, then click Calculate
How is this calculated?
Monthly Mortgage = P × [r(1+r)^n] / [(1+r)^n - 1]
where P = price × (1 - down%), r = annual rate / 12, n = 30 × 12
Total Rent Cost = Σ (monthly_rent × 1.03^year) × 12 (3% annual increase)
Total Buy Cost = Σ (mortgage + tax + maintenance + insurance) - equity gained
Opportunity Cost = down_payment × (1 + invest_return)^years - down_payment
Break-even Year = first year where cumulative buy cost < cumulative rent costFAQ
Frequently asked questions about renting vs buying
How does this rent vs buy calculator work?
It compares the total cost of renting (rent + renter's insurance + rent increases) against buying (mortgage payments + property tax + maintenance + insurance) over your chosen time horizon, including the opportunity cost of your down payment if invested instead.
What is opportunity cost in rent vs buy?
Opportunity cost is the return you could have earned by investing your down payment in the stock market instead of tying it up in a home. At 7% average returns, a $60,000 down payment could grow to over $118,000 in 10 years.
How long do I need to own a home for buying to be worth it?
The break-even point typically ranges from 3 to 7 years depending on your local market, interest rate, and home appreciation. This calculator finds your exact break-even year.
Does this include home appreciation?
Yes. The calculator assumes a 3% annual home appreciation rate (the historical US average). You can adjust this by comparing different scenarios with the mortgage rate and investment return inputs.
Should I include HOA fees?
Include HOA fees in the maintenance percentage input. If your HOA is $300/month on a $400,000 home, that adds about 0.9% to your annual maintenance rate.
Is it always better to buy if I plan to stay long-term?
Not necessarily. In expensive markets with low rent-to-price ratios (like San Francisco or New York), renting and investing the difference can outperform buying even over 15-20 years.