🏠🔄 Rent vs Buy Calculator
Compare the long-term financial impact of renting vs buying. Find your break-even point.
Parameters
🏠 Buying Details
🔑 Renting Details
📈 Investment & Tax
🔑 Renting Wins
$234,113
After 30 years, renting beats buying by
Net Worth Over Time
Yearly Cost Breakdown
⚠️ Hidden Costs of Buying
Maintenance, taxes, insurance, and HOA add up quickly
How Rent vs Buy Works
Core Formula
Buying Net Worth = Home Value - Remaining Mortgage - Selling Costs Renting Net Worth = Invested Down Payment + Monthly Savings Invested
Opportunity Cost
What you could earn investing your down payment instead
Early Sale Penalty
If you sell within a few years, transaction costs can wipe out gains
📊 Example
• Home $400,000, 20% down, 6.5% rate, Rent $2,000/mo:
• After 7 years, buying net worth exceeds renting
• After 30 years, buying net worth ~$1,200,000, renting ~$600,000
❓ FAQ
Is it better to rent or buy a home?＋
It depends on how long you plan to stay, local market conditions, and your financial situation. Our calculator shows the break-even point where buying becomes more advantageous.
What is the break-even point in rent vs buy?＋
The break-even point is when the net worth from buying exceeds renting. Typically 5-7 years in most markets, but varies by location and market conditions.
What hidden costs come with buying a home?＋
Maintenance (~1% of home value/year), property taxes, insurance, HOA fees, and closing costs (3-6% when selling). These can add $5,000-$15,000+ annually.
How does down payment size affect the decision?＋
Larger down payments reduce mortgage costs and avoid PMI. But they also mean more money tied up that could be invested elsewhere.
What is opportunity cost in rent vs buy?＋
Opportunity cost is what your down payment and closing costs could earn if invested instead. At 7% return, $80,000 could grow to $600,000+ over 30 years.
How do interest rates affect the rent vs buy decision?＋
Higher mortgage rates make buying more expensive. A 2% rate increase can shift the break-even point by 3-5 years.
Should I buy if I might move in 3 years?＋
Generally no. Transaction costs (closing + selling commission) can total 8-10% of home value. It usually takes 5+ years for appreciation to offset these costs.
How does home appreciation affect the comparison?＋
Higher appreciation favors buying. At 3% annual appreciation, a $400,000 home becomes $970,000 in 30 years. But appreciation is never guaranteed.