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Rent vs Buy Calculator

Compare the full cost of renting and buying a home over the years you plan to stay. The rent vs buy calculator counts equity, investment returns, and selling costs.

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Reviewed by on
Buying

Renting

Over the period
–

Estimate only. Not financial advice.

How to use the Rent vs Buy Calculator

  1. Fill in the Buying section: price, down payment, mortgage rate, taxes, upkeep, and expected home value growth.
  2. Fill in the Renting section, and set how many Years to compare.
  3. Press Calculate. You see which option costs less and by how much, the break-even year, and a chart of both over time.

How it works

net cost of buying = down payment + buying costs + mortgage payments
                    + property tax + maintenance + insurance
                    − (home value − remaining loan − selling costs)
net cost of renting = all rent paid
                    − investment gain on the down payment, buying costs,
                      and each month's difference in outgoings

The model runs month by month. Home value and rent grow once a year at your rates. The break-even year is the first year buying is cheaper.

Examples

  • $400,000 home with 20% down at 6.5%, 1.1% tax, 1% upkeep, 3% growth, against $2,000 rent rising 3% a year with a 5% return: after 10 years buying costs $213,299 net and renting $191,629, so renting comes out about $21,670 ahead.

Why the answer changes with time

Buying has large costs at both ends: closing costs to get in and agent fees to get out. Over a short stay these usually tip the result toward renting. A longer stay spreads transaction costs over more years and changes the remaining mortgage balance. The outcome still depends on home prices, rent, upkeep, investment returns and selling costs; buying is not guaranteed to become cheaper.

Limitations

  • Tax deductions and capital gains rules differ by country and are not included.
  • Returns and home prices are assumed to grow steadily. Real markets go up and down.
  • Assumes the renter really invests the money a buyer would spend.

Sources and method review

This is Utilza's month-by-month scenario model, with the assumptions displayed above. The CFPB explains rent-versus-buy tradeoffs and the need to try different growth assumptions, and upfront and ongoing homeownership costs. These sources describe costs and uncertainty; they do not endorse this implementation or predict a local housing market.

Technical content review: 27 October 2026. The documented method and assumptions were compared with the calculator code and the cited source. This is not a review by a licensed financial or tax adviser.

Read the guide

Rent or buy, after you run the numbers

Price your income can carry, the full mortgage, and rent versus buy for the years you plan to stay. The figures are estimates, not a decision.

Frequently asked questions

Is it better to rent or buy?

It depends on how long you stay, local prices, and rates. Buying usually wins over longer periods; renting often wins over a few years.

What is the break-even year?

The first year in which the net cost of buying drops below the net cost of renting.

Why does the calculator include investment returns?

Because a renter can invest the down payment. Leaving that out would make buying look better than it is.

Often used together with Rent vs Buy Calculator.