Free Tool
Rent vs. Buy Calculator
See exactly how much mortgage interest you'd pay, and compare the true cost of owning — interest, tax, insurance, maintenance — against renting over however many years you plan to stay.
Estimates assume a constant rate, tax, and rent-increase pattern. Doesn't include home appreciation, equity, or selling costs. For planning purposes only — not financial advice.
How Much Does a Mortgage Really Cost?
A full monthly mortgage payment (often called PITI) is really two very different things bundled together: principal, which pays down what you borrowed and converts directly into home equity you still own, and interest, which is the actual price of borrowing the money — spent, gone, same as rent. Early in a loan, interest dominates each payment; only over time does the split shift toward principal. That's why the calculator above tracks interest paid specifically, not just the total payment.
Owning also comes with costs renting doesn't: property tax, homeowners insurance, maintenance, and sometimes HOA fees. None of that builds equity — it's a genuine cost of the home, the same way rent is a genuine cost of an apartment. Add it to mortgage interest and you get what the calculator calls the "cost of owning": everything spent that doesn't come back as equity in the home.
Why This Calculator Skips Appreciation
Plenty of rent-vs-buy calculators bake in an assumed home appreciation rate to project a future sale price and "net cost." The problem is that appreciation is genuinely unpredictable and varies enormously by market and by year — folding a guess into the math makes the output feel more precise than it really is. This calculator sticks to numbers that are already known or reasonably assumed: your rate, your tax rate, your rent, and how it tends to rise. What it can't tell you is what your home will be worth when you eventually sell — nobody can, reliably.
That also means the "cost of owning" figure above isn't the same as your net financial outcome. Every dollar of principal paid down is still yours, sitting in the home as equity — it's just not counted as a "cost" here, the same way a rent payment would be. If you want the full picture for your own numbers, treat the comparison above as the cash you'd genuinely never see again either way, and remember that ownership's principal payments are effectively forced savings on top of that.
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Frequently Asked Questions
How much interest will I pay over the life of a mortgage?
It depends heavily on the rate and term, but on a 30-year loan it's common for total interest to add up to as much as the amount borrowed, or more — especially in the first half of the loan, when most of each payment goes to interest rather than principal.
Is renting or buying cheaper?
It depends on the home price, mortgage rate, how long you stay, and local rent levels — there's no universal answer. Buying tends to look better the longer you stay, since upfront costs get spread over more years and a fixed-rate mortgage stops rising while rent typically doesn't.
What counts as the "true cost" of owning a home?
The mortgage interest, property tax, homeowners insurance, maintenance, and any HOA fees — the money that's genuinely spent and gone, the same way rent is. The principal portion of a mortgage payment isn't a cost in the same sense, since it converts directly into home equity you still own.
Does this calculator include home appreciation or equity?
No — on purpose. Appreciation rates are unpredictable and vary enormously by market, so baking one in would make the comparison feel more precise than it actually is. This calculator sticks to costs that are already known (interest, tax, insurance, maintenance, rent) rather than guessing at future home values.
How long should I plan to stay before buying makes sense?
Longer is generally better for buying, since closing costs and the interest-heavy early years of a mortgage get spread across more time. Many rules of thumb suggest at least 3-5 years, but running your own numbers over different time horizons in the calculator above is more reliable than any fixed rule.