Rent vs Buy Calculator

Buying vs. renting is one of the most debated personal finance questions. The right answer depends entirely on your situation — there is no universally correct choice. The case for buying: You build equity over time, have stability and freedom to customize, benefit from property appreciation, and mortgage payments are fixed (unlike rent which rises). Historically, real estate appreciates 3–4% annually. The case for renting: No maintenance costs, flexibility to move, no down payment required, and in expensive markets renting is often significantly cheaper month-to-month. The money saved (vs. a down payment) can be invested in stocks, which have historically outperformed real estate. The true cost of buying: Many buyers underestimate the full cost. Beyond the mortgage, factor in: property taxes (1–2% of home value annually), homeowner's insurance, maintenance (budget 1% of home value per year), HOA fees, and transaction costs (3–6% when buying, 6–8% when selling). The break-even point: Buying generally becomes better than renting after 5–7 years in most markets. If you plan to move within 3–4 years, renting is almost always the better financial choice.