Should You Buy?

Rent vs. Buy Calculator

Compare the true cost of renting with buying over time, including appreciation, rent increases, selling costs, and what your down payment could earn invested.

Buying

Today's average as of October 30, 2026. Adjust to your quote.

Renting

Results

Buying Beats Renting

Year 7

Break-even year on these assumptions

Buying comes out ahead in year 7. Plan to stay at least that long, or renting is cheaper on these assumptions.

5-Year Cost of Buying

$184,537

5-Year Cost of Renting

$165,191

10-Year Cost of Buying

$303,383

10-Year Cost of Renting

$352,168

Monthly Mortgage Payment (P&I)$3,820.19
Current Monthly Rent$3,200

Net cost by year (lower is better)

YearBuyingRentingHome Equity
1$72,113$31,400$166,420
2$101,466$63,602$193,876
3$130,017$96,623$222,418
4$157,723$130,480$252,098
5$184,537$165,191$282,971
6$210,410$200,774$315,095
7$235,288$237,244$348,533
8$259,117$274,622$383,350
9$281,837$312,924$419,616
10$303,383$352,168$457,404
11$323,689$392,372$496,793
12$342,681$433,554$537,865
13$360,283$475,732$580,710
14$376,413$518,924$625,419
15$390,983$563,148$672,094
16$403,899$608,422$720,839
17$415,062$654,762$771,767
18$424,365$702,188$824,998
19$431,694$750,715$880,658
20$436,928$800,361$938,883
21$439,936$851,142$999,817
22$440,580$903,076$1,063,613
23$438,712$956,177$1,130,435
24$434,171$1,010,462$1,200,457
25$426,790$1,065,946$1,273,864
26$416,385$1,122,643$1,350,855
27$402,764$1,180,566$1,431,640
28$385,718$1,239,729$1,516,444
29$365,025$1,300,145$1,605,508
30$340,450$1,361,824$1,699,084
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FAQ

Rent vs Buy Calculator Questions

Straight answers from a California mortgage broker.

Buying counts your down payment, every mortgage, tax, and insurance payment, then subtracts what you would net if you sold that year (equity minus selling costs). Renting counts rent with yearly increases, minus the growth your down payment would have earned invested. The break-even is the first year buying costs less.
Southern California has averaged roughly 4-6% a year over long periods but swings widely. The default of 3% is conservative. Test 0% to see the downside and 5% for a typical decade.
Agent commissions, transfer taxes, and closing fees run about 5-7% of the sale price. They are the main reason buying rarely pays off in the first two or three years.

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This information is not intended to be an indication of loan qualification, loan approval or commitment to lend. Rates, terms, and availability of programs are subject to change without notice.

Reviewed by Joann Ton, Loan Officer (NMLS# 1461031) | Last updated: September 2026