Residential · Calculator
Rent vs Buy
Year-by-year comparison of buying vs. renting — with home appreciation, rent growth, and the crossover year where buying pulls ahead.
Buying Scenario
Annual, as a % of home value.
Annual, as a % of home value (~1% rule of thumb).
Annual. US long-run average ~3%.
Renting Scenario
Time Horizon
10-year verdict
Buying wins by $89,624
Crosses over in year 3 of a 10-year horizon.
Side-by-side
Buy
$2,987.30/mo
Upfront $92,000
Total 10yr cost $450,476
Equity built $262,967
Rent
$2,000.00/mo
Upfront $0
Total 10yr cost $277,133
Equity built $0
Year-by-Year
| Year | Buy cost | Rent cost | Equity | Net |
|---|---|---|---|---|
| 1 | $127,848 | $24,200 | $95,251 | −$8,397 |
| 2 | $163,695 | $49,120 | $111,096 | −$3,479 |
| 3 | $199,543 | $74,782 | $127,565 | $2,803 |
| 4 | $235,390 | $101,207 | $144,685 | $10,502 |
| 5 | $271,238 | $128,419 | $162,489 | $19,670 |
| 6 | $307,086 | $156,442 | $181,008 | $30,364 |
| 7 | $342,933 | $185,299 | $200,278 | $42,644 |
| 8 | $378,781 | $215,016 | $220,335 | $56,570 |
| 9 | $414,629 | $245,619 | $241,217 | $72,207 |
| 10 | $450,476 | $277,133 | $262,967 | $89,624 |
Highlighted row = break-even year.
Frequently asked
About this calculator.
What is the "break-even year" in this calculator?
The first year where buying pulls ahead of renting on net financial terms. Buying loads up costs early (down payment + closing) but builds equity over time as you pay down the loan and the home appreciates. The crossover usually lands between year 4 and year 8 in most US markets at today's prices.
Why include home appreciation? Isn't that speculative?
Long-run US home appreciation has averaged 3–5% nominal. The default 3% is conservative. If you expect flat-to-declining prices in your market, drop appreciation to 0 or 1% and rerun — it pushes the break-even out by years. The calculator surfaces this honestly; we don't hide pessimistic scenarios.
Should I just buy because rent is "throwing money away"?
No. Rent buys flexibility, no maintenance liability, no transaction costs to leave. If you're moving in 2 years, buying almost always loses to renting once closing costs and selling commissions are included. The break-even year is the honest answer to "how long do I need to stay for this to be worth it?"
What's the maintenance percentage?
A reasonable rule of thumb is 1% of home value per year for ongoing maintenance and repairs (roof, HVAC, water heater, paint, landscaping). Older homes or harsher climates push this to 1.5–2%. New construction can sit at 0.5% for the first decade.
Does this account for tax deductions on mortgage interest?
No — the SALT cap and the doubled standard deduction since 2018 mean fewer than 13% of homeowners actually itemize. Including tax benefits would mislead the median user. If you're in a high-tax state, hit the standard deduction limit, and write everything off, the buying side comes out a few percent better than shown.
Decided to buy?
Get pre-approved before you tour.
A real pre-approval (not a pre-qual letter generated in 30 seconds) makes your offer stronger, especially in competitive markets. Twenty minutes, no credit pull required for the initial scenario.
Prefer to talk first? Call 707-595-5393