Rent vs Buy Calculator
"You're throwing money away on rent" is the most repeated bad advice in personal finance. At today's mortgage rates, buying breaks even after 5-7 years in most markets. This calculator compares total costs year by year — mortgage, taxes, maintenance, and appreciation vs. rent increases and investment returns on your would-be down payment.
5–7 years (most markets)
Break-Even
1–2% of home value/yr
Maintenance Rule
Rent < 5% × price → rent
5%-Rule Threshold
2–5% of purchase price
Closing Costs
Should you rent or buy a home? Compare the total cost of renting (with or without roommates) against buying over 1 to 30 years. This calculator factors in mortgage payments, property taxes, home appreciation, maintenance costs, and rent increases to find your exact break-even year and give a clear recommendation based on your specific financial situation and local market conditions.
Rent Details
Total rent for the unit (before splitting)
You pay the full rent
Buy Details
Industry standard: 1-2% per year
Comparison Settings
National average: 3-5% per year
Historical average: 3-4% per year
Rent vs Buy Break-Even — Quick Reference
Years until buying beats renting at typical 2026 rates (7% mortgage, 3% appreciation, 3% rent inflation, 7% S&P returns on the would-be down payment).
| Home Price | Equiv Rent | Down Payment | Break-Even (yrs) |
|---|---|---|---|
| $300,000 | $1,800 | $60,000 (20%) | 4–5 |
| $400,000 | $2,200 | $80,000 (20%) | 5–6 |
| $500,000 | $2,800 | $100,000 (20%) | 6–7 |
| $700,000 | $3,500 | $140,000 (20%) | 7–9 |
| $1,000,000 | $4,500 | $200,000 (20%) | 9–11 |
How This Calculator Works
Enter Your Details
Fill in amounts, people, and preferences. Takes under 30 seconds.
Get Fair Results
See an instant breakdown with data-driven calculations and Fairness Scores.
Share & Settle
Copy a shareable link to discuss results with everyone involved.
Frequently Asked Questions
Is it cheaper to rent or buy a home?
It depends on your location, down payment, mortgage rate, and how long you plan to stay. In high-cost cities, renting is often cheaper for the first 5-7 years. In lower-cost areas, buying can be cheaper from year 2-3. Our calculator compares both scenarios with your specific numbers.
What is the break-even point for buying vs renting?
The break-even point is when the total cost of buying (including equity built) becomes less than renting. This typically ranges from 3-7 years depending on home prices, mortgage rates, and rent increases. Our calculator finds your exact break-even year.
How do roommates affect the rent vs buy decision?
Roommates dramatically reduce your effective rent cost. If you split $2,000 rent with a roommate, your $1,000 share may be much cheaper than a $1,800 mortgage payment. Our calculator factors in roommate savings for the renting scenario.
What costs are included in the buy calculation?
Monthly mortgage payment (principal + interest), property taxes, homeowner's insurance, maintenance costs (typically 1-2% of home value per year), and the opportunity cost of your down payment. We also factor in home appreciation as equity gain.
People Also Calculate
Mortgage
Calculate your full monthly mortgage payment — principal, interest, taxes, insurance, PMI, and HOA. Includes an amortization schedule and total cost.
Home Affordability
Get the maximum home price your income actually supports, factoring in debts, PMI, property tax, insurance, and current mortgage rates.
Down Payment
A $400,000 home with 20% down = $80,000 plus $12,000 closing costs. See your total cash needed and a savings timeline to get there.
Rent to Income
For a $2,000/mo apartment, landlords want $6,000/mo gross income (3x rule) or $80,000/yr (40x rule). Check if you qualify solo or with a co-applicant.
Lease vs Buy
Compare the real total cost of leasing versus buying over any time horizon. Find the break-even month and see equity built year by year.
Property Tax
Estimate your annual property tax from home value, assessment ratio, and millage rate. Compare effective rates across all 50 states.
Net Effective Rent
A $3,000/mo apartment with 2 months free actually costs $2,500/mo. Convert any concession package into the real monthly cost and compare up to 10 apartments.
Renters Insurance
Renters insurance runs $15-30/mo for $30K in coverage. Estimate your premium, compare individual vs. joint roommate policies, and find the smarter option.
Roommate Savings
The average roommate saves $700/mo — that's $120,000+ if invested over 10 years at market returns. See your exact savings and what they could grow into.
Related Guide
How to Split Rent Fairly: The Complete Guide
Before you decide to buy, make sure your rent split is fair and your savings are realistic.