US Rent vs Buy Calculator
Analyze the financial outcome of renting versus buying a home in the United States.
Recommendation
Calculating...
Review the comparison below to see whether renting or buying builds more wealth over time.
Renting & Investing
Renting and investing the surplus cash flow.
- Net Wealth (Year 10)
- $0
- Monthly Cost (Year 1)
- $0
- Total Spent (Rent)
- $0
Buying Home
Purchasing a home and building equity.
- Net Wealth (Year 10)
- $0
- Monthly Cost (Year 1)
- $0
- Total Spent (Interest+Fees)
- $0
Comparison
- Wealth Difference $0
- Break-even Year –
- Upfront Cash Required (Buy) $0
Analysis
Update the inputs to generate an analysis.
Should you buy a home or continue renting? In the US market, the answer depends on your location, how long you plan to stay, and the potential returns on alternative investments.
Buying Strategy
When you buy, your monthly payments are often higher initially than rent, but they are fixed (with a fixed-rate mortgage) and you build equity. You also benefit from potential tax deductions (Mortgage Interest, Property Tax).
Renting Strategy
Renting offers flexibility and often lower monthly costs. The key to wealth building while renting is investing the difference. If you save the down payment and the monthly savings in the S&P 500 or a diversified portfolio, your net worth can grow significantly.
Key Factors
- Time Horizon: Buying usually wins if you stay 5-7+ years due to high transaction costs (Closing costs, Agent fees).
- Property Tax: Varies by state (e.g., TX/NJ high, HI/AL low).
- Opportunity Cost: The return you could earn on your down payment if invested elsewhere.