Rent vs. Buy
Compare rough monthly cost of renting versus buying.
About the Rent vs. Buy
Buying beats renting only after enough years to recover the purchase costs. That crossover point, not the monthly comparison, is the real answer.
How to use it
- Enter the purchase price and your rent.
- Enter the rate and how long you expect to stay.
- Compare the totals.
Worked example
With high closing costs and a short stay, renting often wins even when the mortgage payment looks similar to the rent.
Common questions
- Why is renting sometimes cheaper?
- Buying carries costs renting does not: closing fees, maintenance, tax, insurance, and the return you gave up on the deposit.
- How long until buying wins?
- Frequently five to seven years, but it depends heavily on price, rate and local rents.
- Is rent really wasted money?
- No more than interest, tax and maintenance are. Only principal builds equity.