Rent vs Buy Calculator
Should You Rent or Buy?
Renting and buying both have real costs that go beyond the monthly payment. This rent vs buy calculator compares the two over the time you plan to stay, accounting for the mortgage, home appreciation, selling costs and rising rent.
Buying builds equity but ties up your down payment and costs you interest, taxes and maintenance. Renting is simpler but rents usually rise over time and you build no equity. The calculator compares the net cost of each path over your chosen horizon and tells you which is cheaper.
Frequently Asked Questions
When does it make sense to buy instead of rent?
Buying usually wins over longer horizons (5+ years) because home appreciation and principal paydown offset the upfront costs. If you might move within a few years, renting is often cheaper once selling costs (typically 5-6%) are included.
What costs do you pay when buying a home?
Beyond the mortgage payment, buyers pay property taxes, homeowners insurance, maintenance (often 1% of home value per year), closing costs and, with under 20% down, private mortgage insurance (PMI). This calculator models the major ones but not every item.
Is renting always throwing money away?
No. Rent pays for a place to live, just like the interest and tax portions of a mortgage do. The real comparison is what each option costs you after all expenses - renting can be the better financial move over short horizons or in expensive markets.