Rent vs Buy Calculator
Should you rent or buy a home? Compare your net worth under both options, including investment returns on the money you don't put into a house, and find the year buying breaks even.
Rent vs. Buy Analysis
Net-worth comparison of owning versus renting and investing the difference
Your Numbers
US average ≈ 1.2%
Of home value
Agent fees + closing
What the renter earns on savings
Buying doesn't break even within this timeframe — renting and investing the difference builds more wealth.
Calculations are modeled using documented standard financial formulas. Projections and debt ratios are analytical scenarios for underwriting evaluation, not guarantees or binding credit approvals.
Published by ScoutHavens. Data benchmarks calibrated against U.S. Census Bureau ACS, Bureau of Labor Statistics, and Freddie Mac PMMS historical releases.
How to decide whether to rent or buy
The monthly mortgage payment versus rent is the wrong comparison. Owning comes with property tax, maintenance, insurance, and large one-time closing and selling costs, while renting frees up your down payment to be invested. The right question is: after the years you plan to stay, which choice leaves you with more wealth? That's exactly what this calculator answers.
Buying is usually the stronger financial choice if you'll stay 5+ years.
Close call — your timeline, rate, and appreciation assumptions decide it.
Renting and investing the difference often wins, common in high-cost metros.
Price-to-rent ratio = home price ÷ annual rent for a comparable home. A $400,000 home that would rent for $2,200/month has a ratio of about 15.
Check your local market
Prices, rents, and tax rates vary widely by city. See local home prices and rental data before you decide.
Rent vs Buy — Common Questions
Is it better to rent or buy a house in 2026?
It depends mainly on how long you'll stay, the price-to-rent ratio in your area, and mortgage rates. Buying usually wins if you stay long enough to recover closing and selling costs — often 5+ years. In expensive metros where homes cost far more than 20× annual rent, renting and investing the difference often builds more wealth.
How does this rent vs buy calculator work?
It compares your net worth under both choices. The buyer's net worth is the home's sale value minus selling costs and the remaining mortgage. The renter invests the down payment and closing costs, then invests (or withdraws) the yearly difference between owning costs and rent at your chosen investment return.
What is the break-even year in rent vs buy?
The break-even year is the first year in which the buyer's net worth equals or exceeds the renter's. If you plan to move before that year, renting is usually the better financial choice.
What is the price-to-rent ratio rule?
Divide the home price by one year of rent for a comparable home. A ratio under about 15 generally favors buying, 15–20 is a toss-up, and above 20 generally favors renting. Use it as a quick screen, then run the full calculator.
What costs of owning a home do people forget?
Property taxes (about 1.2% of value on average in the US), maintenance (plan on roughly 1% per year), homeowners insurance, closing costs when buying (2–5%), and selling costs when you move (often 6–8% including agent commissions).
Decided to buy? Analyze the home first.
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