TryClearTally
Printed July 6, 2026 · https://trycleartally.com/rent-vs-buy-calculator
Estimates for educational purposes only — not financial advice. See https://trycleartally.com/disclaimer.
Rent vs Buy Calculator
Compare the true cost of renting against buying over the years you actually plan to stay — including rent increases, home appreciation, ownership costs, the equity you'd build, and what your down payment could earn if you invested it instead.
Reviewed by the TryClearTally editorial team · Last updated July 6, 2026 · Methodology & sources
Percent of the home's value per year.
Upkeep as a percent of the home's value; 1% is a common rule of thumb.
One-time costs at purchase; 2–5% is typical.
Agent commission and fees when you sell; ~6% is typical.
Annual return your down payment could earn invested instead.
Cheaper option over 8 years
Renting saves you $9,515
Buying doesn't overtake renting within your stay.
Net cost of renting
$174,169
$213,416 rent − $39,247 investment gains
Net cost of buying
$183,684
$376,289 spent − $192,604 equity built
Break-even year
—
When buying's running total drops below renting's
Monthly P&I payment
$2,023
On a $320,000 loan
Home value after your stay
$506,708
Equity when you'd sell
$192,604
After selling costs and paying off the loan
Cumulative cost over time
Running net cost of each path — rent paid minus investment gains vs cash spent minus equity built. Where the lines cross is the break-even point.
Rent rises once a year; property tax and maintenance track the home's appreciating value; insurance stays flat; closing and selling costs use the percentages above. PMI, HOA dues, and tax deductions aren't modeled. Estimate for comparison only, not financial advice.
Rent vs Buy Comparison
Cheaper option over 8 years
Renting saves you $9,515
PMI, HOA dues, and tax deductions are not modeled. Estimate only, not financial advice.
Calculated using the standard formulas described at https://trycleartally.com/methodology — for educational estimates only, not a quote or financial advice. Verify with your lender or financial institution before making decisions.
How it works
The fair comparison isn't rent vs mortgage payment — it's the net cost of each path over your stay:
- Renting: every rent check (rising each year) is money gone, but your down payment stays invested and grows. Net cost = total rent − investment gains.
- Buying:you pay the down payment, closing costs, mortgage, property tax, insurance, and maintenance — but part of that comes back as equity when you sell (the home's appreciated value minus selling costs and what you still owe). Net cost = everything you spent − equity built.
Example:renting at $2,000/month with 3% annual increases costs about $213,000 in rent over 8 years, but your invested $80,000 down payment earns back about $39,000 — a net cost near $174,000. Buying a $400,000 home with $80,000 down at 6.5% takes roughly $376,000 in cash (closing costs, mortgage, tax, insurance, upkeep), and with 3% appreciation you'd walk away with about $193,000 in equity after selling costs — a net cost near $184,000. Renting narrowly wins at 8 years, but the gap shrinks every year; stay a little longer and buying takes the lead. The break-even year shows where the lines cross for your numbers.
FAQ
It depends almost entirely on how long you stay. Buying has big front-loaded costs (down payment, interest-heavy early payments) that only pay off as you build equity and the home appreciates, so renting usually wins for short stays and buying for long ones. Enter your numbers above — the break-even year shows exactly when buying overtakes renting for your situation.