Rent vs Buy Calculator
“Renting is throwing money away” is a bumper sticker, not a calculation. Buying has its own pile of money you never get back — interest, taxes, maintenance, closing and selling costs. This runs the real comparison over the years you actually plan to stay.
Rent or buy — which actually costs less?
“Renting is throwing money away” is a slogan, not math. Here's the honest comparison for your numbers.
If you buy
If you rent
Over 7 years, renting comes out ahead by
$16,917
Net cost to buy
$172,872
Net cost to rent
$155,955
Mortgage payment runs $2,129/mo before tax, insurance and upkeep. Renting wins here — high rates and a short stay make those upfront and selling costs hard to earn back.
How this works
It tallies the net cost of each path over your time horizon. Buying: down payment, closing costs, 30-year mortgage payments, property tax, maintenance and insurance — minus the equity you walk away with when you sell (home value grown by your appreciation rate, less the 6% it costs to sell and your remaining loan balance). Renting: total rent over the same years, minus the investment growth you'd earn by putting your would-be down payment in the market instead.
The single biggest swing factor is how long you stay. The upfront and selling costs of a home are huge and fixed; the longer you own, the more years there are to spread them across. Short stays almost always favor renting — which is why buying for a two-year stint rarely pencils out.
You set the ones that vary most by market — property tax, homeowners insurance, maintenance, home appreciation, and annual rent increases — so plug in your real numbers. What stays fixed: closing costs (3%), selling costs (6%), a 30-year mortgage, and a 6% return on money you'd otherwise invest. Treat the winner as a lean, not gospel.
// Illustrative only. Not financial advice. A home is also a place to live, not just a spreadsheet line.