Rent vs Buy Calculator
Free rent vs buy calculator with break-even analysis, net worth trajectory, and full monthly cost comparison including maintenance, HOA, and rent growth.
Frequently asked questions
Is it better to rent or buy a house?
It depends on your hold period, local price-to-rent ratio, and expected investment return. As a rule of thumb, buying beats renting when you plan to stay 5-7+ years, price-to-rent is under ~20, and mortgage rates are below the yield you would earn investing the down payment. This calculator makes the tradeoff explicit by comparing the net worth of each path year by year.
What is the break-even year in a rent vs buy comparison?
The break-even year is the first year your net worth as an owner (home equity minus selling costs) equals or exceeds the net worth of renting and investing the equivalent cash. Before that year renting wins on paper; after it, buying does.
Should I include maintenance in the rent vs buy calculation?
Yes — leaving maintenance out is the single most common way rent vs buy calculators overstate the case for buying. A reasonable default is 1% of home value per year for a typical single-family home, higher for older homes or condos with special assessments.
What investment return should I assume for the money I would have used to buy?
A globally diversified stock portfolio has returned ~7% real (after inflation) historically, or roughly 9-10% nominal. Use 6-7% for a conservative comparison and 8-10% for a more aggressive one. Under-estimating this return artificially favors buying.
Does buying make sense if I might move in 3 years?
Usually no. Closing costs on the buy (2-4%) plus selling costs (5-8% with an agent) alone eat 8-12% of the home price. Unless the property appreciates enough to cover that in 3 years, renting almost always wins for short holds — this calculator will show a negative advantage in that scenario.