Rent vs Buy Calculator
Is it better to rent or buy? This calculator compares the total costs of renting versus buying a home over time, including mortgage payments, maintenance, taxes, and investment opportunity costs.
Reviewed by the SparkCalc editorial team
How We Calculate This
Compares total costs over the specified time period. Buying costs include mortgage, taxes, insurance, maintenance, and closing costs, minus equity gained. Renting costs include rent payments plus opportunity cost of not investing.
Sources: U.S. CFPB — Buying a House: Tools and Resources for Homebuyers · Freddie Mac, My Home — Rent or Buy: Which Option Is Right for You? · Freddie Mac, My Home — Rent vs. Buy Calculator
Frequently Asked Questions
How long should I stay to make buying worth it?
Generally, you should plan to stay at least 5-7 years to break even on buying. Transaction costs (closing costs, realtor fees) are significant and need time to be offset by appreciation and equity.
What costs are included for buying?
This includes mortgage payments, property taxes, homeowners insurance, maintenance, closing costs, and the opportunity cost of investing your down payment elsewhere.
What about the mortgage interest deduction?
Tax benefits depend on your situation. With the higher standard deduction, many homeowners no longer itemize. This calculator doesn't include tax benefits, so consider it a conservative estimate for buying.
Why does investment return matter?
If you rent and invest your would-be down payment in stocks averaging 7-10% return, that's an opportunity cost of buying. This calculator factors in what your down payment could have earned.
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You might also find these calculators helpful: Home Affordability Calculator, and Mortgage Calculator.
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This calculator provides estimates for informational purposes only and is not financial advice. Actual outcomes depend on the housing market, interest rates, taxes, and your circumstances. Consult a qualified financial professional.