CalculynQuick answer
A $400,000 home with 20% down at 6.5%, versus $2,200 rent, over 7 years with default assumptions: buying costs about $166,000 net and renting about $156,000, so renting comes out ahead by roughly $10,000. Stay longer and buying usually wins.
How it works
Buying costs your down payment, closing costs (3%), mortgage payments, property tax, insurance and maintenance — minus the equity you walk away with after 6% selling costs. Renting costs your rent — minus what your down payment and closing costs would have earned if invested instead.
Formula
Buy = down + closing + payments + tax/insurance/maintenance − (sale value × 0.94 − loan balance) Rent = total rent − investment growth on (down + closing)
Assumptions & limitations
- Results are rounded for display.
Frequently asked questions
How long do I need to stay for buying to win?
Often 5–10 years, depending on prices, rates and rent. Change 'Years you'll stay' to find your break-even point.
Does this include tax deductions?
No. Most households take the standard deduction, so mortgage interest deductions often don't apply.