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Smart Invest Life
Invest the Difference

Buying, financing and owning a home

Rent vs. Buy Calculator with Break-Even Year

Compare the net cost of buying a home with renting and investing the difference over up to 40 years, and see the year buying starts to come out ahead.

Break-Even and Net Cost

Buy vs. Rent
Cheaper Option Over 10 Years Buying Saves $50,644 in net cost
Break-Even Point 5.5 years When buying beats renting
Net Cost of Buying $210,529 Net cost of renting: $261,174

How This Calculator Works

This calculator compares buying a home with renting and investing the difference. Buying counts your down payment, 3% closing costs, mortgage payments, property tax, PMI, upkeep and insurance (about 1.4% of the home’s value a year), and 6% selling costs when you leave, less the equity you keep. Renting puts the same cash into investments, using the return you enter minus a 15% haircut for taxes. You can test stays from 2 to 40 years.

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