Tool · 07
Rent vs buy
The honest comparison is net worth over time, not rent versus a mortgage payment. This models the home and a portfolio side by side, including the chance to invest the money you do not spend on a down payment.
Buy: net worth at year 10
$259,102
Rent: net worth at year 10
$247,739
Buying pulls ahead
Year 9
After 10 years, buying leaves you about $11,363 ahead of renting and investing the difference. The mortgage payment here is $2,023 a month. Both paths spend the same each month; the renter invests whatever they do not hand to a landlord.
Buying includes 3% closing costs up front and 6% to sell. Net worth for buying is home equity after a sale; for renting it is the portfolio. Insurance, HOA dues, and the mortgage-interest deduction are not modeled, so treat this as the shape of the answer, not the last dollar.
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