Rent vs. Buy Calculator
Deciding whether to rent or buy is a huge decision. This tool helps you see the financial side of it.
Buying Costs
Renting Costs
Results Over 7 Years
Total Cost of Renting
$183,899.092
Net Cost of Buying
$38,554.373
Buying is cheaper by $145,344.72.
The Big Decision: Breaking Down the Costs
It's more than just a mortgage payment versus a rent check. Both options come with a variety of one-time and recurring costs that can impact your finances for years to come. This calculator helps you look at the bigger picture.
The Case for Buying
When you buy a home, your monthly payments build equity—you're paying yourself. You also have the potential for your home's value to appreciate over time. Plus, you get the stability and freedom of owning your own space and can benefit from certain tax deductions.
The Case for Renting
Renting offers flexibility and predictable monthly expenses. You're not responsible for maintenance, repairs, or property taxes, and you don't have to worry about the housing market's ups and downs. This can free up cash for other investments and allows you to move easily if your life changes.
Frequently Asked Questions (FAQ)
How long do I need to stay in a home for buying to be worth it?
This is often called the "break-even point." It's typically around 5-7 years. Before that, the high upfront costs of buying (like closing costs) often make renting cheaper. Our calculator helps you visualize this by showing you the net cost over time.
What other costs should I consider when buying?
Beyond the mortgage, remember property taxes, homeowners insurance, HOA fees (if applicable), and maintenance, which is often estimated at 1% of the home's value annually. These are factored into our calculator to give you a more complete picture.
Can I afford to buy a house?
Affordability depends on more than just the monthly payment. Lenders look at your debt-to-income (DTI) ratio, and a common rule of thumb is the 28/36 rule: your housing costs shouldn't exceed 28% of your gross monthly income, and your total debt shouldn't exceed 36%.