Rent vs Buy Calculator 2026
See when buying breaks even with renting, including opportunity cost and equity buildup.
Over 15 years
Renting wins
Buying never breaks even within 15 years at these rates
Total buying cost
$661,385
Home equity (yr 15)
$348,935
Total rent paid
$446,374
Investment balance (yr 15)
$484,183
Net cost of buying (yr 15)
$312,449
Rent saves
$350,258
Net cost of renting (yr 15)
-$37,809
Buying
Renting
Assumptions
Year-by-year comparison
Net cost = total paid minus equity (buying) or investment balance (renting)
Positive = buying wins
Estimates based on inputs you provide. Actual costs depend on market conditions, tax situation, and maintenance needs.
How it works
The calculator models two parallel scenarios year by year: buying a home with a mortgage, and renting while investing the difference.
Buying costs: Mortgage payment (principal + interest), property tax, homeowner insurance, PMI (if applicable), maintenance (1% of home value/year), and closing costs. Home appreciation builds equity over time.
Renting costs: Monthly rent (increasing annually), renter insurance, and the investment return on money that would otherwise go to a down payment and the monthly cost difference.
The breakeven year is when cumulative buying costs (minus equity) equal cumulative renting costs (minus investment gains). Before breakeven, renting is cheaper. After, buying wins.
FAQ
How long do I need to stay for buying to make sense?
Typically 5-7 years, but it varies by market. High closing costs and transaction fees make short-term ownership expensive. Run your specific numbers above to find your breakeven.
What rate of return should I assume for investments?
The default is 7%, reflecting long-term S&P 500 real returns. Use 5% for conservative estimates or 9-10% for nominal returns before inflation.
Does this include tax benefits of homeownership?
The mortgage interest deduction only helps if you itemize, which most taxpayers don't since the 2017 standard deduction increase. The calculator focuses on direct costs for a clearer comparison.
What is opportunity cost of a down payment?
Money used for a down payment could instead be invested. A $60k down payment at 7% return grows to ~$118k in 10 years. The calculator accounts for this by comparing home equity growth against investment returns.
Related tools
- House Affordability Calculator — how much house can you afford?
- Mortgage Calculator — monthly payment and amortization schedule
- Cost of Living Calculator — compare costs between states
For planning purposes only. Does not account for tax deductions, HOA fees, or local market conditions. Consult a financial advisor for major housing decisions.