Rent vs Buy Calculator

Ownership Break-even Logic

A mortgage payment alone does not decide whether buying wins. This model compares net costs: rent paid, mortgage principal and interest, property taxes, homeowners insurance, home appreciation, remaining loan balance, and the investment return on capital that would otherwise be tied up in the down payment.

What the Break-even Year Means

The break-even point is the estimated year when the accumulated net cost of buying becomes equal to or lower than the accumulated net cost of renting. A shorter break-even period generally favors buying if you expect to stay in the home long enough.

Key Cost Factors

Property taxes, homeowners insurance, and mortgage interest are the three largest recurring ownership costs beyond principal repayment. Meanwhile, renters face annual rent increases but can invest their would-be down payment in the market. The balance between home appreciation and investment returns is often the decisive factor.