Rent vs Buy Calculator — Rent vs buy is one of the largest financial decisions most people make. The "obvious" answer (buy, because you build equity) ignores the opportunity cost of the down payment, ongoing ownership costs, and the time value of flexibility. The "obvious" alternative (rent, because it is cheaper in the short term) ignores the fact that rent goes up every year while a fixed-rate mortgage does not.
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What is rent vs buy calculator?
Rent vs buy is one of the largest financial decisions most people make. The "obvious" answer (buy, because you build equity) ignores the opportunity cost of the down payment, ongoing ownership costs, and the time value of flexibility. The "obvious" alternative (rent, because it is cheaper in the short term) ignores the fact that rent goes up every year while a fixed-rate mortgage does not.
This tool computes the total cost of each path over a 5-15 year time horizon, accounting for: monthly rent (and annual rent increase), mortgage payments, property tax and insurance, maintenance, home appreciation, and the opportunity cost of the down payment (what it could earn in a stock index fund if you were renting instead). The result tells you which path is cheaper over the horizon you choose.
How to use it
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Enter your rent scenario
Current monthly rent and the annual rent increase (typical: 3-5% in stable markets, 5-10% in hot markets).
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Enter the buy scenario
Home price, down payment %, mortgage rate, mortgage term, property tax + insurance, and maintenance. Most of these are public records (county assessor) for a property you are considering.
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Set the appreciation and investment return
Home appreciation: 0-5% realistic for most US markets. Investment return on the down payment: 7-10% long-run historical for a global stock index fund.
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Pick a time horizon
5-7 years is the typical minimum to break even on buying (closing costs eat the first few years of equity). 10-15 years is more realistic for buying to clearly beat renting.
Examples
$500k home, $2.5k rent, 7-year horizon
A typical comparison in a mid-cost US city.
Result: Outcome depends heavily on appreciation and rent inflation. With 3% home appreciation and 3% rent inflation, buying wins by ~$30k. With 5% appreciation and 5% rent inflation, buying wins by ~$80k.
Frequently asked questions
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Last reviewed: 2026-08-23