Rent vs. buy calculator
Torn on renting vs. buying? You're really weighing two separate questions. First, what does the money say — a full financial model with amortization, taxes, and opportunity cost? Second, what matters to you — flexibility, stability, control, and upkeep, weighed against that dollar gap? Both are visible below; neither one is the whole answer alone.
What matters to you
Five simple questions about what matters to you in life — not about renting or buying. We'll work out on our own which way each answer points, and blend that with the numbers on the other side into one answer.
Security
How important is feeling secure about where you live?
Stable home · Children's schooling · Long-term roots · Family security · Peace of mind
Freedom
How important is having the freedom to change your plans in life?
Career opportunities · Relocating · Business · Travel · Flexibility
Achievement
How important is owning a home as a personal life goal?
Pride · Sense of accomplishment · Building something of your own · Personal milestone · Identity
Financial Predictability
How important is having a fixed, predictable housing payment over the long term?
Protection from rent hikes · Long-term planning · Fixed-rate mortgage stability · No surprises
Convenience
How important is having fewer day-to-day responsibilities and unexpected costs?
No maintenance · No surprise repairs · Landlord handles issues · Time commitment · Simplicity
Your priorities, ranked
Your answer: rent or buy?
What the money says
We compare renting and buying the way a bank would: full monthly costs, taxes, and what your money could earn if you invested it instead of spending it on a home. Whoever pays less for housing each month invests the difference.
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Net worth over time
Year by year
| Year | Home value | Loan balance | Equity after selling | Net worth, buying | Net worth, renting | Difference |
|---|---|---|---|---|---|---|
| Year 1 | $439,875 | $336,271 | $72,812 | $72,812 | $114,242 | $-41,430 |
| Year 2 | $455,271 | $332,289 | $91,113 | $91,113 | $131,370 | $-40,257 |
| Year 3 | $471,205 | $328,035 | $110,185 | $110,185 | $149,172 | $-38,986 |
| Year 4 | $487,697 | $323,493 | $130,066 | $130,066 | $167,689 | $-37,623 |
| Year 5 | $504,767 | $318,641 | $150,792 | $150,792 | $186,965 | $-36,173 |
| Year 6 | $522,434 | $313,459 | $172,404 | $172,404 | $207,049 | $-34,645 |
| Year 7 | $540,719 | $307,925 | $194,944 | $194,944 | $227,990 | $-33,046 |
How this is calculated
Every month, whoever pays less for housing invests the gap at your assumed return; the renter starts with the buyer's down payment and closing costs already invested, since that cash never left their pocket. Property tax and maintenance track the home's rising value; rent, insurance, and HOA grow on their own schedules. At the end of the holding period the buyer sells (net of selling costs) and both sides pay tax on their investment growth, so every number you see is after-tax.
Your inputs and answers above are already baked into the link below — share it, or print the full page including the chart and table.
How this calculator works
Stage 1 runs a month-by-month simulation over your holding period. Every month, whichever household — the buyer or the renter — has the lower housing cost invests the difference at your assumed rate of return. The buyer's payment includes principal, interest, property tax (which grows with the home's value), homeowners insurance, HOA, and maintenance; the renter's includes rent (which grows on its own schedule) and renter's insurance. The renter also starts the clock with the buyer's down payment and closing costs already invested, since that cash never left their pocket in the first place.
At the end of the holding period, the buyer "sells" the home net of selling costs, and both sides pay capital gains tax on whatever their invested portfolio grew by — so the final comparison, and every year shown in the table along the way, is on the same after-tax footing. Along the way, the buyer also gets a mortgage-interest tax benefit in any year their itemized deductions (mortgage interest plus property tax, capped at the SALT limit) exceed the standard deduction — and no benefit in years they don't, which is common later in a loan's life as the interest portion of each payment shrinks.
Stage 2 doesn't ask you a single thing about renting or buying. It asks what matters to you in life — security, freedom, achievement, financial comfort, and convenience — the same priorities that quietly drive most housing decisions anyway. For each one you say how much it matters to you next to money, and which choice better satisfies it. The calculator works out on its own which way each answer points, and blends those answers with the financial gap into a single buy-or-rent score.
The two stages are deliberately kept equal in weight on the page. A calculator that only shows the financial answer quietly assumes money is the only thing that matters to you; one that only asks about your life ignores a number that's often tens of thousands of dollars. Seeing both, side by side, is the point.
Frequently asked questions
Is renting always throwing money away?
No. Renting pays for shelter and flexibility, the same way a mortgage payment isn't pure savings either — a large share of it is interest, tax, insurance, and maintenance that builds no wealth. The real comparison is what each side does with the money it isn't spending on housing: a renter who consistently invests the gap between rent and an equivalent mortgage payment can end up ahead of an owner, especially over shorter holding periods.
What is the break-even point, and why does it move so much?
It's the first year the running math flips — the point where buying's total position (home equity plus invested savings) overtakes renting's, or vice versa. It's sensitive to almost every assumption: a slightly higher appreciation rate, a lower investment return, or a longer holding period can shift it by years, because small annual differences compound. Treat it as a directional signal, not a precise date.
Does the mortgage interest deduction still help?
Only if your itemized deductions — mortgage interest plus property tax, capped by the SALT limit — exceed the standard deduction. For many owners with a large standard deduction and a capped SALT benefit, itemizing doesn't clear that bar, especially later in a loan when interest paid each year is lower. This calculator checks that comparison every single year and only applies a tax benefit in years it actually wins.
Why does the renter start with money already invested?
Because a down payment and closing costs are cash a buyer spends immediately and a renter doesn't. That cash has an opportunity cost — if the renter invested it instead, it would grow for the entire holding period. Crediting the renter with that head start is what makes the comparison fair; ignoring it is the single most common mistake in back-of-envelope rent-vs-buy math.
What does Stage 2 add that the financial model doesn't?
Money is only part of the decision. Stage 2 asks five simple questions about what matters to you in life — security, freedom, achievement, financial comfort, and convenience — not about renting or buying at all. It works out on its own which way each answer points, and produces a combined score that can confirm, narrow, or outright flip the financial verdict, depending on how much each thing matters to you.