Rent vs Buy Calculator
Compare the long-term cost of buying a home against renting and investing the difference.
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Quick Tip
Enter the home price, your down payment percentage and the mortgage rate and term.
About This Tool
Why use Rent vs Buy Calculator?
This rent vs buy calculator compares net wealth rather than monthly payments. It simulates every month of ownership — mortgage, property tax, maintenance and insurance — against a renter who invests the down payment, the closing costs and any month where renting is cheaper, then compares the buyer's equity after selling costs with the renter's portfolio.
That framing matters, because comparing rent against a mortgage payment alone always flatters buying. Property tax, maintenance, insurance and the roughly 6% cost of selling are real, and so is the return the renter earns on money that was never tied up in a deposit. The answer usually hinges on how long you stay: buying tends to lose over a short horizon and win over a long one.
Key Benefits
Compares wealth, not payments
Measures the buyer's equity after selling costs against the renter's invested portfolio, which is the only fair comparison.
Full cost of ownership
Property tax, maintenance and insurance scale with the home's value each month, rather than being fixed or ignored.
The renter invests the difference
The renter's portfolio starts with the down payment and closing costs and grows every month that owning costs more than renting.
How to use Rent vs Buy Calculator
- 1
Enter the home price, your down payment percentage and the mortgage rate and term.
- 2
Add ongoing ownership costs: property tax rate, annual maintenance as a percentage of value, and insurance.
- 3
Set closing costs for buying and selling costs for when you eventually sell.
- 4
Enter your current monthly rent and how fast rents rise in your area.
- 5
Set the investment return the renter would earn, then change the number of years to find your break-even point.
Best use cases
Find the number of years at which buying overtakes renting in your city.
Test whether a smaller down payment changes the answer.
See how sensitive the result is to home price appreciation assumptions.
Decide whether to buy now or keep renting while saving a larger deposit.
How this tool compares
Rent vs Buy Calculator FAQs
How many years do I need to stay for buying to beat renting?
Commonly five to seven years, but it depends entirely on your inputs. Buying carries large one-off costs at both ends — closing costs going in and selling costs coming out — so a short stay rarely recovers them. Change the years field to find the break-even point for your own numbers.
Why does the calculator say renting wins when my rent is more than a mortgage payment?
Because a mortgage payment is not the cost of owning. Property tax, maintenance, insurance and selling costs add up, and the renter is earning a return on the deposit that a buyer has locked into the house. Over a long enough horizon, equity and appreciation usually overtake this, but not immediately.
What maintenance percentage should I use?
One percent of the home's value per year is the usual planning figure, covering repairs, replacements and upkeep averaged over time. Older properties and houses with large grounds run higher; a newly built apartment may run lower, though service charges then apply instead.
Does this account for the tax deduction on mortgage interest?
No. The comparison is before tax, because the benefit varies enormously by country and by whether you itemise. In the US, most households now take the standard deduction and get no additional benefit from mortgage interest, so leaving it out is closer to reality for the majority.
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