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) 583-3666