Buy vs. Rent Calculator
See the break-even year and compare the long-term net worth of buying a home versus renting.
Calculating...
💡 Useful Concepts
- Break-Even Point: The year in which the net worth of the homeowner (equity) surpasses the net worth of the renter (investment portfolio). This is the key metric for your decision.
- Total Ownership Cost: This is more than just the mortgage. It includes interest, property taxes, insurance, and maintenance. This is the true "rent" you pay to yourself as a homeowner.
- Invest the Difference: The core assumption for a fair comparison. If renting is cheaper on a monthly basis, the renter must invest those savings to build wealth.
- Opportunity Cost: The money used for a down payment could have been invested in the market. Our calculation includes the potential growth of this amount in the renter's scenario.
- Home Equity: The value of your home minus the remaining loan balance. This is your primary source of wealth as a homeowner.
⚠️ This calculator is for educational purposes and is not financial advice. The projections are based on your inputs and are not a guarantee of future performance. Real estate and investment returns can vary significantly.