Understanding Rent vs Buy
The rent vs buy decision is one of the biggest financial choices you'll make. It's not just about monthly payments—it's about building wealth over time and understanding the true cost of each option.
When you buy, you build equity as you pay down your mortgage and your home appreciates. When you rent, you have flexibility and can invest the money you would have spent on a down payment. This calculator compares both paths to show which builds more wealth over your chosen time horizon.
Buying Pros
Build equity, fixed payments, potential appreciation, tax benefits
Renting Pros
Flexibility, no maintenance costs, lower upfront costs, invest elsewhere
Inflation Impact
Rent increases with inflation; mortgage payments stay fixed
Break-Even Point
The year when buying starts to financially outperform renting
Key factors that influence the decision:
- Time horizon — The longer you stay, the more buying typically wins
- Home appreciation — Local market conditions matter significantly
- Investment returns — What you could earn investing the down payment
- Rent vs price ratio — In expensive cities, renting may be more economical