Buy vs Rent Calculator
Compare buying vs renting a home with our advanced calculator and make
data-driven decisions for your future. BuyVsRent.io weighs the full
cost of ownership against renting, including the opportunity cost of
your down payment, so you can see which path actually builds more
wealth over time.
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How this calculator works
The calculator runs a year-by-year comparison of two scenarios. On the
buying side, it totals your mortgage payments, property taxes,
homeowners insurance, maintenance, and closing costs, and tracks how
your home equity grows as the property appreciates. On the renting
side, it totals your rent over time and, crucially, invests the money
you would have spent on a down payment and any monthly savings, so the
comparison accounts for the opportunity cost of tying up cash in a home.
The result is a clear picture of your long-term net worth under each
choice and the break-even point: the year at which buying becomes
cheaper than renting. You can tailor the analysis with historical
property and rental growth rates for your region (data provided by
Zillow), your tax situation, and your expected investment returns, then
track how your wealth builds through property ownership versus
alternative investments.
Frequently Asked Questions
What costs does the calculator include when comparing buying and renting?
On the buying side: mortgage principal and interest, mortgage insurance,
property tax, homeowners insurance, HOA fees, maintenance, and any
additional income tax compared to renting. On the renting side: rent,
renters insurance, and any additional income tax compared to buying.
What's the difference between recoverable and non-recoverable costs?
Recoverable costs are money that builds equity you keep, like mortgage
principal payments. Non-recoverable costs are money you don't get back:
mortgage interest, mortgage insurance, property tax, home insurance, HOA
fees, and maintenance for buyers; rent and renters insurance for
renters, since renters have no recoverable housing costs at all.
Comparing non-recoverable costs alone is a common way to judge
day-to-day affordability separately from equity building.
What is extra cash, and how does it factor into the comparison?
Whichever option costs less each month leaves you with extra cash. The
calculator assumes that cash doesn't sit idle. It can be spent, saved,
invested in a stock/bond portfolio, and for buyers, applied directly to
the mortgage to reduce future interest.
How does my down payment affect the results?
Your down payment, interest rate, and mortgage length together determine
your monthly mortgage payment. A down payment below 20% of the purchase
price on a conventional mortgage also triggers mortgage insurance, an
added monthly cost until you build enough equity. Mortgage interest is
generally tax-deductible, which can affect the income tax side of the
comparison.
Does buying always build more net worth than renting?
Not necessarily. The calculator tracks net worth as home equity (from
both mortgage principal payments and home price appreciation) plus cash
and other investments for buyers, versus an invested portfolio of
savings for renters. You can also view both unrealized net worth (value
on paper) and realized net worth (what you'd actually walk away with
after selling).
Does the calculator account for the cost of selling my home?
Yes. Selling costs include real estate agent commission (typically 2-3%
of the sale price), closing costs (typically 1-2%), and capital gains
tax on both your home and any other investments you'd choose to
liquidate.
How are my income taxes estimated, and how does owning a home change them?
Federal and state income taxes are estimated from your filing status,
number of dependents, and pre-tax income. As a homeowner, deductions
like mortgage interest and property tax can lower your taxable income
relative to a renter. The calculator tracks your estimated tax owed and
tax savings, which vary from state to state, because not every state
offers the same deductions.
How do property taxes and maintenance costs factor in?
Property tax is charged yearly as a percentage of your home's assessed
value, typically 1-2%, to fund local services. Maintenance is estimated
as a percentage of what the building alone is worth, because it scales
with the structure and not the land under it.
Where does the home price and rent data come from?
When you select a zipcode, city, county, or metro area, the typical
purchase prices and appreciation rates are filled in using Zillow's Home
Value Index, and typical rents and rent growth are filled in using
Zillow's Observed Rent Index. You can always override these values with
your own numbers if you have more specific information about a property.
What return rate should I use for invested extra cash?
The calculator offers preset historical blends as a starting point: an
aggressive portfolio (100% stocks), a moderate portfolio (60% stocks /
40% bonds), and a conservative portfolio (20% stocks / 80% bonds), plus
a simple savings account preset. Pick one under the expected return
lookup, or enter your own assumption if you have a different investment
strategy in mind.
Buy vs rent by metro area
Compare typical single-family home values, rents, and price-to-rent
ratios in major U.S. metros, using Zillow data updated monthly, then
run the full comparison with your own numbers. Browse
all metro areas or jump to a city:
- Buy vs rent in Austin, TX
- Buy vs rent in Chicago, IL
- Buy vs rent in Dallas, TX
- Buy vs rent in Denver, CO
- Buy vs rent in Las Vegas, NV
- Buy vs rent in Los Angeles, CA
- Buy vs rent in Miami, FL
- Buy vs rent in Nashville, TN
- Buy vs rent in New York, NY
- Buy vs rent in Phoenix, AZ
- Buy vs rent in Salt Lake City, UT
- Buy vs rent in Seattle, WA
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