Is it cheaper to rent or to buy? Compare the total cost of both options over the years you plan to stay, including mortgage interest, maintenance, property growth, rent increases and what your deposit could earn if invested instead.
How to use the Rent vs Buy Calculator
- Enter the home price, down payment, mortgage rate and term.
- Enter your current monthly rent and the expected yearly rent increase.
- Adjust the assumptions: home price growth, yearly ownership costs (tax, insurance, maintenance) and investment return.
- Choose how many years you plan to stay and compare the net cost of renting and buying.
How the comparison works
Buying cost = down payment + all mortgage payments + ownership costs − the equity you own at the end (home value minus remaining loan balance, less selling costs).
Renting cost = all rent paid − the investment growth you would have earned by investing the down payment and any monthly savings instead of buying.
The option with the lower net cost is financially better under your assumptions. The break-even year shows when buying starts to beat renting.
Assumptions matter
Results are very sensitive to house price growth, rent inflation and investment returns. Try pessimistic and optimistic values to see a range rather than a single answer.
Frequently asked questions
Is buying always better than renting?
No. Buying usually wins over long periods, but if you move within a few years, transaction costs and interest often make renting cheaper.
What ownership costs should I include?
Property tax, homeowners insurance, maintenance (often 1% of the home value per year) and any service charges. Enter them as a yearly percentage of the home value.
Why does the calculator include investment returns?
Money used for a deposit has an opportunity cost — if you rent, it could be invested. Ignoring this makes buying look better than it is.