Rent vs Buy: Which Is Cheaper Over 30 Years?
The rent vs buy decision depends heavily on local home appreciation. Renting's 30-year cost = (monthly rent × 360) + (deposit opportunity cost). Buying's 30-year net cost = (mortgage × 360 + property taxes × 30) − home appreciation. In markets with strong appreciation (50–100%+ over 30 years), buying often wins on a pure cost basis. In flat or declining markets, the math often favors renting. The key insight: buying a home isn't just an expense — it's also an appreciating asset.
This calculator simplifies a complex decision. Not included: closing costs (3–5%), homeowner's insurance (~$1,500/year), maintenance (typically 1% of home value/year), HOA fees, tax deductions on mortgage interest, or the investment returns you'd earn if you invested your down payment instead. For a true comparison, add these to the ownership side of the equation. The break-even point — where buying becomes cheaper than renting — varies widely by city and market conditions.
Frequently Asked Questions
US home prices have historically appreciated about 3–4% per year, compounding to roughly 143–226% over 30 years. Use 50–100% for a conservative estimate and 150–200% for an optimistic one. Local markets vary enormously — check your city's historical data.
No. The mortgage interest deduction can reduce your effective ownership cost by $2,000–$6,000+/year depending on your tax bracket and mortgage size. Itemizing deductions makes buying even more advantageous for higher earners.