Rent vs Buy Calculator

🏠 Scenario A — Renting

Monthly Rent ($)

Renters Insurance ($/month) Typically $15–$30/month

Annual Rent Increase (%) Average U.S. rent increase per year

🏡 Scenario B — Buying

Home Price ($)

Down Payment

= $0 down payment

Annual Mortgage Rate (%)

Loan Term

Monthly Property Tax ($)

Monthly Homeowners Insurance ($)

Monthly HOA ($)

Annual Maintenance (%) Standard rule of thumb: 1% of home value per year

Shared Assumptions

Your timeline — how long do you plan to stay? 7 years

1 year 30 years

Drag to adjust — all results update automatically.

Filing Status

Annual Home Appreciation (%)

Annual Investment Return (%) If you rent, your down payment stays invested. 7% reflects a long-term diversified index fund average.

Federal Tax Bracket (%)

This is a financial estimate. The right choice also depends on your life plans, flexibility needs, and local market.

Monthly Cost Breakdown

🏠 Renting

Monthly rent—

Renters insurance—

Location costs—

Total monthly cost—

🏡 Buying

Mortgage P&I—

Property tax—

Homeowners insurance—

HOA—

Maintenance—

PMI (removed at 20% equity)—

Tax benefit—

Location costs—

Total monthly cost—

* Closing costs () included in wealth comparison above.

Break-Even Analysis

Yr 0 Yr 30

7-Year Wealth Comparison

🏠 Renting

—

Total advantage vs buying (cumulative cost basis)

🏡 Buying

—

Total advantage vs renting (cumulative cost basis)

🏙️ Location changes everything

Most calculators stop here. Yours doesn't have to. Are you comparing a walkable neighborhood to a suburban home? A city apartment to a house with a longer commute? Add commute and transportation costs to see the true cost of each living situation — not just the housing payment.

Location & Commute Costs

Add transportation costs for each scenario to see the full cost of each living situation.

🏠 Scenario A: Renting Location Costs

Transportation costs ($/month)

Include transit pass, gas, parking, tolls — combined monthly total

Car Ownership Required?

🏡 Scenario B: Buying Location Costs

Transportation costs ($/month)

Include transit pass, gas, parking, tolls — combined monthly total

Car Ownership Required?

Include time value of commute?

For informational purposes only. Not financial advice. All figures are estimates based on general financial planning principles. Tax benefit estimates use 2026 standard deductions and are not personalized tax advice. Individual results will vary based on local market conditions, personal finances, and factors not captured here. Consult a qualified financial advisor before making major decisions.

Why It Matters

The numbers most buyers never see

50–60%

Monthly Premium to Buy

In most U.S. markets in 2026, buying costs 50–60% more per month than renting a comparable home

5–7 years

Typical Break-Even

The average break-even point in 2026, accounting for closing costs and opportunity cost of the down payment

$63,000

Invested Down Payment

A $50,000 down payment invested at 7% grows to ~$63,000 in 5 years — often outpacing home equity in flat markets

Housing is your biggest FIRE lever.

Your housing cost — and the wealth you build or preserve — is likely the single largest variable in your financial independence timeline. A $500/month difference between renting and buying doesn't just affect your budget today. Compounded over 10–20 years, it can move your FIRE date by years. Once you know your housing numbers, model your full picture in RetireSmart.

→ Model your FIRE timeline in RetireSmart

How we calculate these estimates ▼

Mortgage P&I: Standard amortization formula using monthly compounding.
PMI: 0.5% annually of original home price, auto-removed when loan balance reaches 80% of original home price.
Closing costs: 3% of home price upfront; selling costs: 6% of appreciated home value at end of horizon.
Tax benefit: Simplified estimate. Applied only when mortgage interest + property tax exceeds the 2026 standard deduction ($32,200 MFJ / $16,100 single). This is not personalized tax advice.
Opportunity cost: Down payment + closing costs invested at specified annual return, compounded annually.
Home appreciation and rent increases applied annually from year 2.
Renting wealth: If monthly renting cost is lower, the difference is assumed invested monthly at the specified return rate.
Time value of commute: (daily minutes × 2 × 22 working days) ÷ 60 = monthly hours × hourly rate.

All figures are estimates for educational purposes and do not constitute financial or tax advice. Individual results will vary.

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