Rent vs. Buy Calculator
Monthly mortgage payments are just one piece of the buying equation. Property taxes, insurance, PMI (if your down payment is under 20%), HOA fees, and closing costs all add up. This calculator compares the real out-of-pocket cost of renting vs. buying over your planned time horizon, accounting for the equity you'd build and what you'd net after selling.
Rule of thumb: buying usually beats renting around 5–7 years in most markets, but it depends on costs.
Renting
Buying
Monthly cost breakdown
Rent
Buy
PMI added: With a 10% down payment, you'll pay approximately $2,160/year in private mortgage insurance until your loan balance drops below 80% of the home's value. Put 20% down to eliminate it.
True cost over 7 years (after selling / moving out)
Rent
$183,899
Total rent paid (with 3%/yr increases)
$0 equity returned at move-out.
Buy
$175,127
Net cost after recovering equity at sale
Equity at sale: ~$95,335 (includes ~3%/yr appreciation, minus ~6% selling costs).
At 7 years, buying is cheaper by $8,772 in this scenario.
The longer you stay, the more buying tends to win. Your monthly payment stays fixed while rent rises, and you build equity. This calculator includes ~3% closing costs on purchase and ~6% selling costs at exit.
What you can actually change
Time horizon — This is the most important variable. Buying rarely makes sense financially unless you plan to stay 5+ years. The math changes dramatically at 7–10 years.
Down payment — More down means lower monthly payment and no PMI. But a larger down payment also ties up cash that could earn returns elsewhere — there's a tradeoff.
Mortgage rate — Shop multiple lenders. A 0.5% rate difference on a $400k loan saves over $40k over 30 years. Rate is one of the few things you can negotiate.
Your next step
If buying makes sense for your timeline, get pre-approved and compare at least 3 lender rates before committing.
Pre-approval takes an hour and gives you a real number to work with — not a guess. Rate differences between lenders on the same loan can vary by 0.5–1%, which adds up to tens of thousands over the life of the loan.
Includes estimated closing costs (~3% on purchase, ~6% on sale), PMI for down payments under 20%, and compounding rent increases. Does not include maintenance costs (budget 1% of home value/year), tax deductions, or investment returns on the down payment difference. Results are illustrative. Your market conditions and specific costs will vary.
Ready to take action?
Figure out your housing situation
Know what you can actually afford before signing anything.