Rent vs Buy Calculator - Cost Comparison (2026)

At 6.5% mortgage, 3% rent growth and 3% appreciation, renting is cheaper for about 5 years on a $400,000 home vs $2,000 rent; buying is ahead $38,000 by year 7 and $96,000 by year 10. At 7.5% mortgage or 0% appreciation, renting wins for 7 to 9 years. Your rent level and horizon decide more than the rate.

Break-even is the first year where buying net wealth (equity after 6% sale + principal paid) minus PITI, maintenance and closing exceeds renting net wealth (invested $92,000 at 6% plus rent paid). For the base case that is year 5 with $123,200 renter investment vs $463,700 home value and $126,800 rent paid.

Yes, it includes property tax at 1.1% of price ($367 on $400k), insurance at $125 monthly and maintenance at 1% ($333) in PITI-plus. Buying closing at 3% ($12,000) and selling at 6% ($29,500 at year 7) are also included. PITI alone is $2,516 on $400k at 6.5% 30-year with 20% down.

Use 3% rent growth matching BLS CPI rent at 3.5% year over year in 2026 and 3% home appreciation matching the long-run 3% to 4% nominal. Stress at 1% and 5% for both: 1% appreciation pushes break-even from 5 to 9 years, 5% rent growth pulls it to 4 years.

With 20% down you need $80,000 down plus $12,000 buying closing at 3% ($92,000 cash) and $2,516 PITI plus $333 maintenance ($2,849 monthly). With 10% down you need $40,000 plus $12,000 closing ($52,000 cash) but PITI is $2,750 plus $193 PMI at 0.7% ($2,943) and break-even moves to 6 years.

Raising the mortgage from 6.5% to 7.5% on $320,000 loan raises P&I from $2,024 to $2,262, adding $238 monthly and $85,680 over 360 months. Break-even moves from 5 to about 7 years and the 10-year buying lead falls from $96,000 to about -$12,000 under 3% appreciation, so renting wins longer.

This calculator does not include: (1) federal or state tax benefit of mortgage interest deduction, which depends on itemizing versus $15,000/$30,000 standard deduction in 2026; (2) renters insurance versus homeowners price differences; or (3) moving costs, rent control or HOA special assessments. It assumes fixed rates for the full horizon.

Yes, buying closing at 3% of price ($12,000 on $400k) and selling at 6% of future value ($29,500 on $491,900 at year 7) are subtracted from buying wealth. That $41,500 round-trip is why buying loses for 4 years even at 3% appreciation and needs 5 years to recover.

At 3 years with 3% appreciation and 6.5% mortgage, renting is ahead about $22,000 on $400k vs $2,000 rent because $12,000 closing plus $25,000 selling on $437,000 value wipes out $37,000 appreciation and principal paid is only $15,000. Buying generally needs 5+ years to beat renting after transaction costs.

The renter invests $92,000 at the entered return, here 6% ($123,200 in 5 years, $164,700 in 10 years). At 8% the renter investment is $135,400 in 5 years and $198,800 in 10 years, cutting the buying lead from $96,000 to $52,000 at 10 years. Higher renter returns delay break-even by about 1 year per point.