Compare the true cost of renting and buying over time — including appreciation, investment returns on your down payment, and your breakeven year.
"Investment return" estimates what your down payment could earn if invested instead — used to compare renting fairly.
Instead of just comparing a mortgage payment to rent, this calculator estimates the true net cost of each option. For buying, that's your closing costs, mortgage interest, property tax, insurance, and maintenance — minus any equity you gain from home appreciation. For renting, it's your total rent paid — minus the investment growth your down payment and closing costs could have earned if you'd invested them instead of buying.
The breakeven point is the first year where buying's net cost drops below renting's net cost. Move out before that point and renting was likely the better deal financially; stay longer and buying usually wins.
Two assumptions drive most of the difference: how fast your home appreciates, and what your down payment would have earned if invested elsewhere. A high investment return rate makes renting look better, since it means tying up cash in a down payment has a bigger opportunity cost. Try adjusting the appreciation and investment return fields to see how sensitive your specific breakeven point is.
If you're leaning toward buying, check the House Affordability Calculator to confirm the price fits your budget, and the DTI Calculator to see how it affects your loan approval odds. If you're carrying other debt, our article on paying off debt before buying a house can help you decide what to tackle first.
Does this include selling costs if I move?
Not directly — it assumes you stay in the home for the full comparison period rather than modeling a sale. If you expect to sell, remember that typical selling costs (agent commissions, closing costs) of 6-8% would reduce your buying-side equity.
What if I already have the down payment sitting in cash?
The comparison still holds — the "investment return" reflects what that cash could earn elsewhere if you didn't put it into a home, regardless of whether you're borrowing it or already have it saved.
Why does a longer stay usually favor buying?
Upfront costs like closing costs are one-time, so they get "spread out" over more years the longer you stay, while rent keeps recurring and growing every year. Equity and appreciation also compound over time, which tends to tip the math toward buying the longer you're in the home.