Rent vs Buy Calculator: Should You Rent or Buy a Home?
See what you'd really have after 5, 10 or 30 years of owning versus renting and investing the difference — with rising rents, home appreciation, taxes, selling costs and inflation all included. Local data for every U.S. county, city and ZIP code.
Data: U.S. Census Bureau ACS 2020–2024 · Mortgage rate 7.24% (Freddie Mac, 2026-10-29) · Updated 2026-11-01 · How we calculate
Calculator
Start typing a county, city or ZIP code, then pick it from the list.
Showing U.S. medians. Search 3,134 counties, 21,664 cities and towns, and 24,884 ZIP codes — or just type your own numbers.
$66,600
30-yr avg 7.24% on 2026-10-29
$3,130 a year
Fine-tune assumptions (growth, inflation, costs, taxes)
After 20 years
Renting comes out ahead by $36,270
$22,135 in today's dollars. At these numbers buying doesn't catch up within 30 years. Buying wins over 20 years if comparable rent is above $1,649/mo (you entered $1,584).
If you buy
- Home value
- $662,600
- Mortgage still owed
- −$154,710
- Selling costs
- −$39,756
- Tax on home sale
- −$4,478
- You walk away with
- $463,655
If you rent and invest
- Cash not spent on buying
- $76,590
- Monthly savings invested
- $142,197
- Growth at 6.0%, after tax
- +$281,139
- You walk away with
- $499,926
Both cards are in year-20 dollars.
Monthly cost in year 1
- Mortgage (principal + interest)
- $1,816
- Property tax
- $261
- Home insurance
- $194
- Maintenance
- $278
Principal isn't really a cost — it becomes equity. The comparison that matters is the money you never get back, below.
What your numbers mean
In the first year, owning costs about $2,548 a month: $1,816 mortgage payment, $261 property tax, $194 insurance, $278 upkeep. Renting a comparable home costs $1,584. So the renter has $964 a month left over, and invests it — on top of the $76,590 down payment and closing costs they never had to spend.
Rent rises 3.5% a year, so within 20 years it never catches up with the cost of owning (taxes, insurance and upkeep grow with the home's value too).
After 20 years the home is worth $662,600 (growing 3.5% a year from $333,000). You still owe $154,710 on the mortgage and pay about $39,756 to sell plus $4,478 capital gains tax, leaving $463,655 in equity.
The renter's investments, earning 6.0% a year, grow to $499,926 after 15% tax on the gains. That only happens if the money really is invested every month — renting and spending the difference makes buying the better choice almost everywhere.
Renting leaves you $36,270 richer after 20 years. With inflation at 2.5% a year, a dollar then buys what 61 cents buys today, so the gap is worth $22,135 in today's money.
The result is sensitive: it flips if home prices grow 5% a year instead of 3.5%, or if your mortgage rate is 6.24% instead of 7.24%, or if investments earn 4% a year instead of 6%, or if rent rises 4.5% a year instead of 3.5%. See "What would change the answer" below.
Total cost over 20 years
| Where the money goes | Amount |
|---|---|
| Down paymentequity | $66,600 |
| Mortgage principalequity | $111,690 |
| Closing costs | $9,990 |
| Mortgage interest | $324,033 |
| Property tax | $88,521 |
| Insurance | $65,920 |
| Maintenance | $94,171 |
| Selling costs | $39,756 |
| Total paid to buy and own | $800,681 |
| Money you never get back | $626,869 |
| Rent | $537,540 |
| Renter's insurance | $4,598 |
| Money you never get back renting | $542,138 |
“Equity” rows are savings locked in the home, not costs. Figures are in future (nominal) dollars.
What would change the answer?
Nobody knows future home prices, rents or market returns. Each row below reruns your exact numbers with just one thing changed, so you can see which assumptions matter. Rows marked “Answer flips” change the winner.
| What if… | Who comes out ahead, and by how much |
|---|---|
| Nothing changes — your numbers, staying 20 years | Renting ahead by $36,270 |
| Home prices grow 2% a year instead of 3.5% | Renting ahead by $140,776 |
| Home prices grow 5% a year instead of 3.5% | Buying ahead by $82,605Answer flips |
| Your mortgage rate is 6.24% instead of 7.24% | Buying ahead by $47,021Answer flips |
| Investments earn 4% a year instead of 6% | Buying ahead by $88,510Answer flips |
| Investments earn 8% a year instead of 6% | Renting ahead by $207,825 |
| Rent rises 4.5% a year instead of 3.5% | Buying ahead by $44,478Answer flips |
| You stay 15 years instead of 20 | Renting ahead by $42,213 |
| You stay 25 years instead of 20 | Renting ahead by $29,927 |
Year-by-year breakdown
| Year | Home value | Loan balance | Owning / yr | Rent / mo | Net worth (buy) | Net worth (rent) | Difference |
|---|---|---|---|---|---|---|---|
| 1 | $344,655 | $263,817 | $30,577 | $1,584 | $60,159 | $92,149 | −$31,990 |
| 2 | $356,718 | $261,040 | $30,885 | $1,639 | $74,275 | $108,168 | −$33,893 |
| 3 | $369,203 | $258,055 | $31,203 | $1,697 | $88,996 | $124,666 | −$35,671 |
| 4 | $382,125 | $254,847 | $31,533 | $1,756 | $104,350 | $141,661 | −$37,311 |
| 5 | $395,500 | $251,399 | $31,874 | $1,818 | $120,370 | $159,173 | −$38,803 |
| 6 | $409,342 | $247,693 | $32,227 | $1,881 | $137,089 | $177,222 | −$40,134 |
| 7 | $423,669 | $243,709 | $32,593 | $1,947 | $154,540 | $195,829 | −$41,290 |
| 8 | $438,497 | $239,428 | $32,971 | $2,015 | $172,760 | $215,017 | −$42,257 |
| 9 | $453,845 | $234,825 | $33,362 | $2,086 | $191,789 | $234,807 | −$43,018 |
| 10 | $469,729 | $229,878 | $33,768 | $2,159 | $211,667 | $255,225 | −$43,557 |
| 11 | $486,170 | $224,561 | $34,187 | $2,234 | $232,438 | $276,294 | −$43,856 |
| 12 | $503,186 | $218,846 | $34,621 | $2,313 | $254,148 | $298,041 | −$43,893 |
| 13 | $520,797 | $212,703 | $35,070 | $2,394 | $276,846 | $320,494 | −$43,648 |
| 14 | $539,025 | $206,101 | $35,535 | $2,477 | $300,583 | $343,679 | −$43,096 |
| 15 | $557,891 | $199,004 | $36,016 | $2,564 | $325,414 | $367,627 | −$42,213 |
| 16 | $577,417 | $191,376 | $36,514 | $2,654 | $351,397 | $392,368 | −$40,972 |
| 17 | $597,627 | $183,177 | $37,030 | $2,747 | $378,593 | $417,935 | −$39,342 |
| 18 | $618,544 | $174,364 | $37,563 | $2,843 | $407,067 | $444,360 | −$37,292 |
| 19 | $640,193 | $164,892 | $38,116 | $2,942 | $435,571 | $471,678 | −$36,107 |
| 20 | $662,600 | $154,710 | $38,687 | $3,045 | $463,655 | $499,926 | −$36,270 |
| 21 | $685,791 | $143,767 | $39,279 | $3,152 | $493,129 | $529,141 | −$36,012 |
| 22 | $709,793 | $132,004 | $39,891 | $3,262 | $524,069 | $559,363 | −$35,294 |
| 23 | $734,636 | $119,361 | $40,525 | $3,376 | $556,870 | $590,941 | −$34,072 |
| 24 | $760,348 | $105,771 | $41,181 | $3,494 | $592,115 | $624,414 | −$32,299 |
| 25 | $786,961 | $91,165 | $41,859 | $3,617 | $629,968 | $659,896 | −$29,927 |
| 26 | $814,504 | $75,465 | $42,562 | $3,743 | $670,606 | $697,506 | −$26,900 |
| 27 | $843,012 | $58,590 | $43,289 | $3,874 | $714,213 | $737,373 | −$23,160 |
| 28 | $872,517 | $40,451 | $44,042 | $4,010 | $760,989 | $779,632 | −$18,642 |
| 29 | $903,055 | $20,955 | $44,821 | $4,150 | $811,148 | $824,426 | −$13,278 |
| 30 | $934,662 | $0 | $45,627 | $4,296 | $864,915 | $871,908 | −$6,993 |
Difference is positive when buying is ahead. Each row assumes you sell at the end of that year.
How this rent vs buy calculator works
Most calculators compare a mortgage payment with a rent check. That misses most of the story. This one follows two households with the same money for every month you plan to stay:
- The buyer pays the down payment and closing costs, then the mortgage, property tax, insurance, maintenance, any HOA and PMI.
- The renter invests the cash the buyer spent up front, pays rent (rising every year), and invests whatever is left over each month the rent is cheaper than owning.
- When owning becomes cheaper than renting — rent keeps rising, a fixed-rate mortgage doesn't — the buyer invests the difference instead.
- At the end, the buyer sells: home value minus the loan, selling costs and any capital gains tax. The renter cashes out their investments after tax. Whoever has more money wins.
Everything is simulated month by month, and every assumption — price growth, rent growth, investment returns, inflation, taxes — can be changed. See the full methodology for formulas and sources.
Why rent vs buy calculators give different answers
Run the same home through three calculators and you can get three verdicts. The math is similar; the assumptions aren't. The biggest is what the renter's money earns — the down payment and monthly savings they invest instead of putting into a house. Next come home price growth, the mortgage rate and how long you stay. Here's how the answer for a U.S. median home ($332,700, 3-bedroom rent $1,584, 7.24% rate, 20 years) moves when one assumption changes:
| Assumption | Who comes out ahead over 20 years |
|---|---|
| Investments earn 4% a year | Buying, after year 12 — by $89,139 |
| Investments earn 5% a year | Buying, after year 16 — by $31,832 |
| Investments earn 6% a year (our default) | Renting, for all 30 years — by $35,396 |
| Home prices grow 4.5% a year | Buying, after year 11 — by $39,451 |
| Mortgage rate 1 point lower | Buying, after year 13 — by $47,820 |
That's why this calculator shows every assumption, lets you change all of them, and lists the ones that would flip your result. If you wouldn't actually invest the money you save by renting, use a lower return — or treat buying as the safer choice.
When buying is the better choice
- You'll stay a long time. The one-time costs of buying and selling get spread over more years, and every year of price growth works on the whole home value, not just your down payment.
- Your payment is locked in. Rent rises with inflation; a fixed-rate mortgage payment doesn't. After 10–15 years owning is often far cheaper month to month — and after payoff, you only pay taxes, insurance and upkeep.
- Leverage. With 20% down, a 3.5% rise in the home's price is a 17.5% gain on your cash (before costs). Leverage works in reverse too when prices fall.
- Forced savings. Each mortgage payment builds equity automatically. Many renters don't actually invest the difference.
- Tax-free gains. Up to $250,000 of profit ($500,000 for married couples) on a main home you've lived in for 2 years is tax-free.
- Stability and control. No lease renewals, no landlord selling the building, freedom to renovate.
When renting is the better choice
- You might move within 5 years. Selling costs of 6% or more can wipe out years of appreciation.
- Homes are expensive relative to rent. When a home costs more than 20 years of rent, owning's unrecoverable costs usually exceed rent.
- Mortgage rates are high. At 7%, close to 90% of each early payment on a 30-year loan is interest — money you never get back.
- You'll invest the difference. A diversified portfolio has historically grown faster than home prices, without property tax, repairs or a 6% exit fee.
- Flexibility and less risk. No single asset holding most of your net worth, and you can follow a job anywhere.
- No surprise bills. Roofs, furnaces, insurance hikes and special assessments are the landlord's problem.
Price-to-rent ratio and the 5% rule: two quick checks
Price-to-rent ratio = home price ÷ (monthly rent × 12). Nationally the median home is worth $332,700 and a 3-bedroom rents for $1,584, a ratio of 17.5. Below 15 leans buy, 15–20 is balanced, above 20 leans rent.
The 5% rule estimates owning's yearly unrecoverable cost as about 5% of the home's value: ~1% property tax, ~1% maintenance and ~3% cost of capital (mortgage interest and the return your down payment could have earned). Multiply the price by 5% and divide by 12: if comparable rent is lower, renting is probably cheaper. For a $400,000 home that's $1,667 a month. With today's higher rates, 6% is a more realistic figure — the calculator above does this properly with your own numbers.
Rent vs buy by state
Median home value against median 3-bedroom rent in every state, from the Census Bureau's 2020–2024 American Community Survey. States at the top are where buying most often pays off; search your own area in the calculator for local figures.
| State | Median home value | 3-bed rent | Price-to-rent | Property tax | Leans |
|---|---|---|---|---|---|
| West Virginia | $162,600 | $1,034 | 13.1 | 0.51% | Buy |
| Mississippi | $169,800 | $1,055 | 13.4 | 0.58% | Buy |
| Oklahoma | $199,800 | $1,208 | 13.8 | 0.79% | Buy |
| Arkansas | $188,000 | $1,134 | 13.8 | 0.56% | Buy |
| Texas | $283,800 | $1,650 | 14.3 | 1.40% | Buy |
| Kansas | $217,200 | $1,260 | 14.4 | 1.21% | Buy |
| Iowa | $208,000 | $1,201 | 14.4 | 1.33% | Buy |
| Michigan | $231,600 | $1,321 | 14.6 | 1.19% | Buy |
| Illinois | $263,300 | $1,480 | 14.8 | 1.88% | Buy |
| Indiana | $218,200 | $1,220 | 14.9 | 0.76% | Buy |
| Louisiana | $216,500 | $1,205 | 15.0 | 0.55% | Buy |
| Nebraska | $238,600 | $1,307 | 15.2 | 1.44% | Balanced |
| Ohio | $214,800 | $1,176 | 15.2 | 1.36% | Balanced |
| Kentucky | $205,600 | $1,112 | 15.4 | 0.74% | Balanced |
| Pennsylvania | $254,500 | $1,373 | 15.4 | 1.25% | Balanced |
| Alabama | $209,900 | $1,127 | 15.5 | 0.36% | Balanced |
| Missouri | $230,300 | $1,220 | 15.7 | 0.89% | Balanced |
| Florida | $359,000 | $1,884 | 15.9 | 0.78% | Balanced |
| Alaska | $352,900 | $1,845 | 15.9 | 0.94% | Balanced |
| North Dakota | $249,900 | $1,304 | 16.0 | 0.92% | Balanced |
| New Mexico | $248,100 | $1,281 | 16.1 | 0.63% | Balanced |
| Wisconsin | $266,500 | $1,290 | 17.2 | 1.32% | Balanced |
| South Carolina | $259,000 | $1,240 | 17.4 | 0.49% | Balanced |
| Minnesota | $329,300 | $1,573 | 17.4 | 1.00% | Balanced |
| Connecticut | $366,900 | $1,749 | 17.5 | 1.54% | Balanced |
| Maine | $296,600 | $1,411 | 17.5 | 0.98% | Balanced |
| Georgia | $303,300 | $1,419 | 17.8 | 0.79% | Balanced |
| Vermont | $316,600 | $1,481 | 17.8 | 1.51% | Balanced |
| Maryland | $419,900 | $1,948 | 18.0 | 0.92% | Balanced |
| Tennessee | $286,700 | $1,319 | 18.1 | 0.52% | Balanced |
| Delaware | $352,000 | $1,619 | 18.1 | 0.54% | Balanced |
| Arizona | $394,500 | $1,808 | 18.2 | 0.48% | Balanced |
| North Carolina | $288,900 | $1,321 | 18.2 | 0.66% | Balanced |
| South Dakota | $257,400 | $1,169 | 18.3 | 1.00% | Balanced |
| New Hampshire | $402,500 | $1,816 | 18.5 | 1.50% | Balanced |
| New Jersey | $454,400 | $2,037 | 18.6 | 1.89% | Balanced |
| Virginia | $383,700 | $1,680 | 19.0 | 0.78% | Balanced |
| Nevada | $435,400 | $1,883 | 19.3 | 0.50% | Balanced |
| New York | $423,800 | $1,828 | 19.3 | 1.30% | Balanced |
| Wyoming | $309,700 | $1,290 | 20.0 | 0.53% | Rent |
| Rhode Island | $404,200 | $1,647 | 20.5 | 1.12% | Rent |
| Oregon | $477,600 | $1,850 | 21.5 | 0.81% | Rent |
| Colorado | $539,400 | $2,077 | 21.6 | 0.50% | Rent |
| Montana | $375,800 | $1,394 | 22.5 | 0.61% | Rent |
| Washington | $564,600 | $2,058 | 22.9 | 0.75% | Rent |
| Idaho | $418,600 | $1,517 | 23.0 | 0.49% | Rent |
| Utah | $489,400 | $1,716 | 23.8 | 0.48% | Rent |
| Massachusetts | $562,100 | $1,950 | 24.0 | 1.00% | Rent |
| District of Columbia | $737,100 | $2,503 | 24.5 | 0.60% | Rent |
| California | $734,700 | $2,351 | 26.0 | 0.70% | Rent |
| Hawaii | $839,100 | $2,624 | 26.6 | 0.29% | Rent |
The ratio is a screen, not a verdict: it ignores rates, taxes and how long you stay, and compares owner-estimated home values with rents paid by all current tenants.
Inflation: why the calculator shows today's dollars
A home that grows 3.5% a year, from $400,000 to $795,916 over 20 years, sounds like a windfall, but with 2.5% inflation $795,916 in 20 years buys what $485,724 buys today. Inflation also works for owners: the mortgage payment is fixed in dollars, so it shrinks in real terms every year while rent keeps pace with prices. Tick “Show amounts in today's dollars” to see every result adjusted for inflation.
Frequently asked questions
Is it better to rent or buy a house right now?
It depends most on how long you'll stay, how home prices compare with rents where you live, and your mortgage rate. At U.S. median figures (a $332,700 home against $1,584 rent for a 3-bedroom) and the latest weekly mortgage rate of 7.24% (2026-10-29), renting and investing comes out ahead over 20 years; at 6% buying would pull ahead after 11 years, and at 5% buying would pull ahead after 6 years. Local answers vary widely, so search your county, city or ZIP code above.
How long do I need to stay for buying to make sense?
Buying has large one-time costs — roughly 2–5% to buy and 6–8% to sell — that take years of price growth and loan paydown to recover. Where homes cost few years of rent and rates are moderate, buying can pull ahead within about 5 years; in expensive markets at today's rates it can take 15 years or more, or never happen. The calculator shows the break-even year for your numbers.
What is the price-to-rent ratio?
The median home price divided by a year of median rent. Below about 15, buying usually looks attractive; 15–20 is balanced; above 20, renting usually looks better. It's a quick screen, not a verdict, because it ignores mortgage rates, taxes and how long you stay.
Isn't renting just throwing money away?
No more than mortgage interest, property tax, insurance and maintenance are. Rent buys housing; so do the unrecoverable costs of owning. Only the principal you pay down is savings. Renting wins when rent is lower than those unrecoverable costs and the renter invests the difference.
What inflation rate does the calculator use?
2.5% a year by default — U.S. consumer prices (CPI-U) rose 2.6% a year on average over the last 30 years, a little above the Federal Reserve's 2% target. Inflation is used to show results in today's dollars; home prices (3.5%), rents (3.5%) and investments (6.0%) have their own growth rates, which you can change.
Why does the calculator assume the renter invests the difference?
To compare like with like. A buyer's down payment and monthly principal build wealth; a renter only builds wealth if they invest the cash they didn't spend on buying. If you would spend that money instead, buying is likely the better choice because it forces saving.
Where does the local data come from?
The U.S. Census Bureau's American Community Survey (ACS) 5-year estimates for every county, city, town and ZIP code: median home values, median rents by bedroom count, property taxes paid, household income and homeownership. The mortgage rate is Freddie Mac's weekly 30-year average.
Does the calculator include the mortgage interest tax deduction?
Only if you tick "I itemize deductions." Since 2018 the standard deduction is high enough that roughly 9 in 10 households don't itemize, so for most buyers mortgage interest brings no tax savings. Gains on selling your main home are tax-free up to $250,000 (single) or $500,000 (married) once you've owned and lived in it for 2 years, which the calculator applies.
Sources
- U.S. Census Bureau, American Community Survey 5-year estimates, 2020–2024 and 2015–2019 (tables B25077, B25064, B25031, B25090, B25082, B19013, B25003).
- Freddie Mac Primary Mortgage Market Survey, 30-year fixed rate, via FRED (latest: 7.24% on 2026-10-29).
- U.S. Bureau of Labor Statistics, Consumer Price Index: all items (CPI-U) and rent of primary residence, via FRED — basis for the inflation and rent-growth defaults.
- Federal Housing Finance Agency, House Price Index (all transactions), via FRED — basis for the home price growth default.
- IRS Publication 523 (home sale exclusion) and Publication 936 (mortgage interest deduction).
Data updated 2026-11-01. This calculator is for education, not financial advice.