Rent vs Buy Calculator | Should I Rent or Buy a House?

What is Rent vs Buy Calculator | Should I Rent or Buy a House??

A rent vs buy calculator compares total costs of renting versus purchasing a home over specific time period (typically 5-10 years), accounting for mortgage payments, property taxes, maintenance, insurance, opportunity cost of down payment, home appreciation, rent increases, and tax benefits. Shows breakeven point when buying becomes financially advantageous over renting. Factors include: purchase price, down payment, mortgage rate, rent amount, annual rent increases, home appreciation rate, investment return on down payment, and planned ownership duration. Essential for home-buying decision making, comparing markets, and understanding true cost differences.

Key Benefits & Use Cases

Make informed housing decisions with complete financial picture—buying not always better despite "rent is throwing away money" narrative. Discover renting often cheaper short-term: closing costs ($10k-20k), maintenance ($3k+ annually), property taxes, and HOA fees mean renting wins for 3-5 year timeframes in many markets. Understand market dependencies: in expensive cities with high home prices and low rents (San Francisco, New York), renting remains cheaper for 7-10+ years. Reveal hidden buying costs: mortgage interest ($100k+ over 30 years), property taxes ($5k+ annually), maintenance/repairs (1-3% of home value yearly), opportunity cost of down payment invested elsewhere (7-10% annual returns). Calculate wealth impact: $50k down payment invested at 8% for 10 years grows to $108k versus home equity which depends on appreciation rate and remaining mortgage balance.

How to Use This Calculator

Enter home purchase price, down payment amount (typically 10-20%), mortgage interest rate and term (30-year most common), estimated property tax rate and insurance, maintenance costs (1-2% of home value annually), and current home value appreciation rate in area (2-5% historical average). Enter current monthly rent and expected annual rent increases (2-4% typical). Select timeframe for comparison (5, 10, 15 years). Calculator shows total cost for each option, breakeven point (when buying becomes cheaper), net worth comparison accounting for home equity versus invested down payment, and monthly cost comparison. Renting wins if: staying less than breakeven period (often 5-7 years), home prices expensive relative to rent (price-to-rent ratio >20), or investment returns on down payment exceed home appreciation. Buying wins for: long-term stays (10+ years), stable home-price-to-rent markets, and desire for fixed housing costs.