Rent vs. Buy Calculator
Compare the full lifetime cost of renting vs. buying a home over a chosen time horizon, including all hidden costs on both sides.
How to use the Rent vs. Buy Calculator
- Enter your inputs into the Rent vs. Buy Calculator above.
- Results update instantly as you type — no submit button needed.
- Adjust any value to see how the result changes in real time.
The rent vs. buy comparison
Renting cost = Σ (Rent + utilities × inflation^t) − Investment growth of down payment · · · Buying cost = Σ (PITI + maintenance) − Equity built − Appreciation
The right comparison includes opportunity cost of the down payment, maintenance costs (1–2% of home value/year), property tax growth, mortgage amortization and home appreciation.
Worked example
Renting a $2,200 apartment vs. buying a $400,000 home with $80,000 down at 6.5%, holding 10 years. Renting (with 3% rent inflation): about $303,000 net cost. Buying (with 3% appreciation, 2% taxes, 1% maintenance): about $186,000 net after equity and appreciation. Buying wins here by ~$117,000.
Frequently asked questions
What is the break-even time horizon?
Often called the "5-year rule" — generally, owning beats renting if you stay 5+ years. Below that, transaction costs of buying and selling typically erase the benefits.
Should I include opportunity cost?
Yes — the down payment could earn investment returns instead. Most rent-vs-buy calculations include this; the answer becomes more pro-rent at higher assumed investment returns.
Does rent inflation matter?
Significantly over long horizons. Rents historically rise 2–4% per year. A fixed mortgage payment stays the same while rents climb, eventually crossing over and making owning much cheaper.