With 30-year mortgage rates around 6.5% and median home prices near $400,000, the rent vs. buy decision is more nuanced than ever. The conventional wisdom — "buying is always better than renting" — ignores the real numbers. This calculator compares the true unrecoverable costs of both options: mortgage interest, property taxes, insurance, and maintenance on the buying side; monthly rent on the renting side.
The break-even point is the number of years you need to stay in a home before buying becomes cheaper than renting on a cumulative basis. Before break-even, renting saves money. After break-even, buying has cost less in total unrecoverable expenses. In most U.S. markets at current rates, the break-even is between 6 and 15 years — meaning short-term buyers are often better off renting.
We use an unrecoverable cost model: we only count money you can never get back. For buying, that means mortgage interest (not principal), property tax, homeowner's insurance, maintenance, and 2.5% closing costs. We do not include home appreciation — keeping the model conservative and honest. For renting, we count rent payments growing at an assumed annual inflation rate.
Default values reflect 2026 U.S. national averages: 6.5% mortgage rate, 1.1% property tax, 0.5% homeowner's insurance, 1% annual maintenance, 3% rent inflation. Adjust any input to match your local market. Property tax rates vary widely — from under 0.5% in Hawaii to over 2% in New Jersey.