Rent vs Buy Calculator
for the US

It depends on how long you stay, your down payment, the rent and price in your area, and the mortgage rate you can lock. As a rule of thumb, the longer you stay and the faster you expect home prices to appreciate, the more buying wins. With 30-year fixed rates near 6.5% to 7% and rents rising around 3% to 4% nationally, the breakeven horizon for most US metros currently sits in the 6 to 10 year range — longer in high-cost, high-property-tax markets.

Buying costs include the down payment, closing costs (roughly 2% to 5% of the price — loan origination, title insurance, escrow, appraisal), PMI if your down payment is under 20%, the monthly mortgage payment, property tax (about 1.1% of value per year on average but from under 0.4% to over 2% by state), homeowners insurance, HOA where applicable, and maintenance (a common estimate is 1% of value per year). Renting costs are mostly rent plus renters insurance, while the down payment you would have used to buy is invested instead and earns a return.

The breakeven point is the number of years it takes for your wealth from buying — home equity, meaning value minus loan balance — to overtake your wealth from renting — your invested down payment plus any monthly cash-flow savings invested. Before breakeven, renting leaves you with more money; after it, buying does. The higher your closing costs, property tax, and mortgage rate, the later the breakeven year.

Property tax is the cost that most separates US markets. At the 1.1% national average, a $420,000 home carries about $4,600 a year, but Texas, New Jersey, and Illinois can run 2% or more — over $8,000 a year on the same home — while Hawaii and Alabama sit near 0.4%. Because it is charged every year on the full home value (which is rising), a high property-tax rate pushes the rent-vs-buy breakeven out by several years. Set the property-tax input to your county's actual effective rate for a realistic result.

Include PMI if your down payment is under 20%. Private mortgage insurance is charged as an ongoing annual premium — roughly 0.4% to 1.1% of the loan balance per year — not a one-off cost. It automatically stops once you reach about 20% equity, either by paying down the loan or through appreciation. This calculator applies a PMI estimate every month the loan is above 80% of the home's value and drops it automatically after that.

This calculator models pre-tax cash flows and does not assume you itemize. Since the 2017 tax law raised the standard deduction, most households no longer itemize, so the mortgage-interest and SALT (state and local tax, capped at $10,000) deductions provide no benefit to them. If you do itemize and your deductions clear the standard deduction, buying looks modestly better than shown here. Treat any tax benefit as upside, and confirm it with a tax professional.

A defensible long-run assumption for a diversified stock index portfolio is around 6% to 7% per year nominal after inflation, or roughly 9% to 10% before inflation. The S&P 500 has averaged near 10% nominal including dividends over long horizons, but past returns do not guarantee future returns. For a fair comparison, keep the investment-return and home-appreciation assumptions in the same ballpark, since both reflect long-run growth in different asset classes.

Three forces favor buying over time. Home prices tend to appreciate, growing your equity. Your loan balance falls each month as you repay principal, so a larger share of the home is yours. And rent inflation compounds — what you pay in year 20 of renting is far above year 1. Together these usually overtake the higher upfront cost of buying somewhere between years 6 and 12, depending on your inputs.

The figures are in nominal dollars — they include inflation rather than stripping it out. The home appreciation, rent growth, and investment return inputs should also be nominal. For a real-return view, lower each growth rate by your inflation assumption (recently around 3% in the US) and the breakeven year will shift slightly later.

Yes — Richify is free to start on the App Store and Google Play in the US. The app tracks your net worth across bank accounts, brokerage and retirement accounts, real estate, and crypto, so you can stress-test a rent-vs-buy decision against your full financial picture, with Felix and the specialist AI agents.