Rent vs Buy Calculator
Buying isn't automatically better than renting — it depends on how long you stay. This compares the full cost of both over your actual time horizon, including selling the home at the end.
Your numbers
Your result
Renting
Total rent paid over the whole stay. Nothing to sell at the end.
Buying (net cost)
All ownership costs minus what you get back when you sell.
Buying assumes 2% closing costs at purchase and a 30-year mortgage. Not included: investing the down payment instead (which would favor renting), renters insurance, or moving costs on either side.
How the rent vs. buy comparison works
Renting's cost is simple: every rent check, gone forever. Buying's cost is everything you spend — down payment, closing costs, mortgage payments, property tax, insurance, maintenance — minus what comes back when you sell: the sale price, less the remaining loan balance and roughly 6% in selling costs.
Net cost of buying = down payment + closing costs + all monthly costs over the stay − (sale price − selling costs − remaining loan balance). The calculator simulates month by month, growing the home's value and the rent each year.
Time is the deciding factor because buying has large one-time costs at both ends. Over 2–3 years those costs swamp the equity you build; over 10+ years, principal paydown and appreciation usually pull buying ahead, and your payment stays fixed while rent keeps climbing.
Frequently asked questions
What is the 5-year rule for buying a home?
A common rule of thumb: if you won't stay at least five years, renting usually wins, because buying and selling costs (roughly 2% in, 6% out) need time to be offset by equity and appreciation. Drag the “years you'll stay” slider above to find the break-even point for your own numbers — it's often between years 4 and 7.
Isn't rent just “throwing money away”?
Rent buys housing, flexibility, and freedom from repairs — while a large share of a homeowner's early payments (interest, tax, insurance, maintenance) never comes back either. In the default example above, a buyer spends well over six figures on costs that build no equity. The honest comparison is total unrecoverable cost on both sides, which is what this calculator shows.
What about investing the down payment instead?
That's a real cost of buying this tool leaves out, so treat close results as tilting toward renting. An $80,000 down payment invested at 7% for 7 years grows to about $128,000 — if the comparison above is within that ballpark of difference, the flexibility of renting deserves serious weight.