Rent vs. Buy Calculator
The real question isn't "can I afford the mortgage" — it's how long until buying pays off. Enter the home, the rent, and your timeline. The calculator finds your breakeven year and compares the true all-in cost of each path, including the opportunity cost of your down payment.
Your numbers
How the breakeven is found
- Buying, year by year: down payment + buying closing costs + every monthly cost (principal & interest, property tax, insurance, HOA, maintenance, PMI) — minus what you'd walk away with if you sold: the appreciated home value, less the remaining mortgage balance and selling costs.
- Renting, year by year: rent, growing at rent inflation — minus the growth of the cash the renter didn't tie up (down payment + buying closing costs), invested at your assumed return. That's the opportunity cost of buying, made explicit.
- Breakeven is the first year the buyer's net cost drops below the renter's. The single biggest swing factor is home appreciation — run it at a conservative and an optimistic number and check whether your decision survives both.
- Not modeled: the tax benefit of mortgage interest (most filers take the standard deduction, so it's usually $0), renters insurance, moving costs, or the value of your time spent on maintenance.
Frequently asked questions
What is the breakeven year in rent vs. buy?
The breakeven year is the first year when the total net cost of buying (down payment, closing costs, mortgage, taxes, insurance, HOA, maintenance — minus the equity you'd walk away with) drops below the total net cost of renting for the same period. Stay longer than breakeven and buying has the lower lifetime cost; move sooner and renting wins.
Why does the calculator assume the renter invests the down payment?
Because it's the honest comparison. A buyer ties up the down payment and closing costs in the house; a renter keeps that money and can invest it. Ignoring that makes buying look better than it is. The calculator grows the renter's unspent cash at the investment return you set, and you can change that assumption.
Does the calculator include the tax benefit of mortgage interest?
No. Since the 2017 tax changes roughly 90% of filers take the standard deduction, so most buyers get no incremental tax benefit from mortgage interest. If you itemize, buying is somewhat cheaper than shown here.
What if I put down less than 20%?
Most lenders then require private mortgage insurance (PMI), typically 0.3%–1.5% of the loan per year, until you reach 20% equity. Enter your estimated PMI as a monthly cost — it pushes the breakeven year later.
How sensitive is the answer to home price appreciation?
Very. Appreciation is the single biggest swing factor: at 5%+ annual appreciation buying usually wins within a few years, while at 0–2% renting often wins for a decade or more. Run the calculator at both a conservative and an optimistic appreciation rate and see whether your decision survives both.
Should I include HOA dues?
Yes, if the home you're considering has them. HOA dues are a real monthly cost of owning that renters don't pay, and they rise over time. Leaving them out flatters the buying case.