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Rent vs Buy Calculator

Enter your rent, home price, and key details to instantly compare the true monthly cost of renting versus buying — and discover when buying breaks even.

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Plan Your Home Purchase Budget

Whether you decide to rent or buy, having a clear budget plan is essential. Our free budget template helps you track savings, expenses, and reach your housing goals faster.

Get the Free Budget Template →

How This Rent vs Buy Calculator Works

  1. Enter your monthly rent and the home price you are considering.
  2. Adjust the down payment percentage, mortgage rate, and loan term.
  3. Instantly see your estimated mortgage payment, the monthly cost difference, and the break-even year.

The break-even calculation assumes 3% annual rent increases and 3% annual home appreciation. In reality, these numbers vary by market — use this as a starting point for deeper research.

Key Factors to Consider

  • Hidden costs of homeownership — property tax, homeowner's insurance, HOA fees, maintenance (budget 1-2% of home value per year).
  • Opportunity cost — the down payment could be invested in the stock market instead.
  • Mobility — if you might move within 3-5 years, renting is usually cheaper.
  • Tax benefits — mortgage interest deduction can reduce the effective cost of buying.

Related Resources

Frequently Asked Questions

Is it always better to buy than rent?

No. Buying makes financial sense when you plan to stay 5+ years, have a stable income, and can afford the down payment without depleting your emergency fund. In expensive markets with low rent-to-price ratios, renting and investing the difference can be better.

What down payment should I aim for?

20% is ideal because it avoids private mortgage insurance (PMI), which adds 0.5-1% of the loan annually. However, FHA loans allow as little as 3.5% down if you are a first-time buyer.

Does this calculator include property taxes?

The mortgage payment shown is principal and interest only. Property taxes (~1.1% of home value), insurance (~0.35%), and maintenance (~1%) should be added separately for a complete comparison.