Home Purchase Assumptions
Rental Assumptions
Buying creates more long-term wealth!
In the United States, home ownership acts as forced savings and builds equity, but renting offers flexibility and frees capital to compound in the stock market.
Timeline Comparison by Year
| Year | Net Cost to Buy | Net Cost to Rent | Winning Option |
|---|---|---|---|
| 1º years | $ 13,869 | $ 20,100 | Buy (+$ 6,231) |
| 2º years | $ 27,149 | $ 40,520 | Buy (+$ 13,371) |
| 3º years | $ 39,811 | $ 61,247 | Buy (+$ 21,436) |
| 4º years | $ 51,824 | $ 82,268 | Buy (+$ 30,444) |
| 5º years | $ 63,156 | $ 103,568 | Buy (+$ 40,412) |
| 6º years | $ 73,775 | $ 125,129 | Buy (+$ 51,354) |
| 7º years | $ 83,644 | $ 146,929 | Buy (+$ 63,285) |
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How it works
Enter target home purchase price, down payment percentage, mortgage interest rate, and property tax.
Provide monthly rent for a comparable home, anticipated rent inflation, and stock market investment returns.
View the breakeven year, monthly outlay breakdown, and net worth trajectory comparison.
Frequently asked questions
How does the Rent vs. Buy calculation work?
It compares unrecoverable costs of homeownership (mortgage interest, property tax, HOA, maintenance, closing costs) against unrecoverable rent payments, while factoring in home appreciation and the opportunity cost of investing your down payment.
What is the typical breakeven period for buying in the US?
In most US housing markets, the breakeven timeline is between 4 and 7 years. Moving sooner often results in a net financial loss due to 6% broker commissions and closing costs.
Is this tool free?
Yes. The site is supported by ads, so you never pay or need to create an account.
Does it work on mobile?
Yes. The page adapts to your screen and does not require installing any app.