The "rent is throwing money away" trope misses the opportunity cost of the down payment. If you buy, the down payment is locked up in a non-liquid asset earning the appreciation rate. If you rent, the same capital can sit in a 60/40 portfolio earning a different rate. The calculator runs both paths and tells you when buying overtakes renting in total wealth.
Realistically the answer depends on your hold period, your local rent vs price ratio, your interest rate, and the alternative investment return. We model all of them with sane defaults you can override.
What you can do
- ✓Total-wealth comparison over your hold period
- ✓Opportunity-cost modeling for the down payment
- ✓Rent inflation assumption
- ✓Closing-cost amortization
- ✓Break-even hold-period calculation
Frequently asked questions
What hold period makes buying worth it?+
In most US markets, 5-7 years is the typical break-even. Below that, transaction costs (agent fees, closing) eat the gain. The calculator gives you a specific number for your inputs.
Does this work for high-cost-of-living cities?+
Yes — and HCOL markets often have unfavorable rent vs price ratios that push the break-even out to 8-10+ years. Worth running before committing.
Ready to run the numbers?
The Rent vs Buy Calculator runs entirely in your browser. Free, no sign-up required to use it.
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