Rent vs. buy: what is your rent really buying?

See where your rent goes over 1, 2, 5, and 7 years — and what the same payment could be buying instead.

Affordability calculator

Your rent today

We use your rent as the housing budget and solve for the price that fits it.
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What you hand your landlord every month

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Minimum 3.5%

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Per month

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Per month

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Agent + transfer costs

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Tax + insurance escrow

Paying $2,200/mo in rent could buy

Same monthly outlay, FHA loan with 3.5% down.
$281,304
Est. purchase price
Monthly payment: $2,200
Principal & interest$1,791
Property tax$164
Insurance$120
HOA$0
FHA mortgage insurance$124
Cash to get in
Down payment$9,846
Closing costs (2.75%)$7,736
Prepaids (3 mo escrow)$852
First year insurance policy$1,440
Est. cash to close$19,874

Loan amount $276,209 — includes $4,751 upfront FHA MIP (1.75%) financed into the loan.

Rent gone vs. equity built

After 12 months
Building
If you keep renting
Total rent paid$26,400
Equity earned$0
Rent by then$2,288/mo
If you buy
Principal paid down$2,944
Appreciation (3%–4%)$8,439 – $11,252
Loan balance$273,265
Total equity position$16,478 – $19,291
Net proceeds if sold (after 6%)$0 – $1,738
Net of cash to close-$19,874 – -$18,136
After 2 years
Building
If you keep renting
Total rent paid$53,856
Equity earned$0
Rent by then$2,380/mo
If you buy
Principal paid down$6,092
Appreciation (3%–4%)$17,131 – $22,954
Loan balance$270,117
Total equity position$28,319 – $34,142
Net proceeds if sold (after 6%)$10,413 – $15,886
Net of cash to close-$9,461 – -$3,987
After 5 years
Ahead
If you keep renting
Total rent paid$142,991
Equity earned$0
Rent by then$2,677/mo
If you buy
Principal paid down$16,916
Appreciation (3%–4%)$44,804 – $60,945
Loan balance$259,293
Total equity position$66,815 – $82,956
Net proceeds if sold (after 6%)$47,249 – $62,421
Net of cash to close$27,375 – $42,548
After 7 years
Ahead
If you keep renting
Total rent paid$208,515
Equity earned$0
Rent by then$2,895/mo
If you buy
Principal paid down$25,446
Appreciation (3%–4%)$64,665 – $88,873
Loan balance$250,763
Total equity position$95,205 – $119,414
Net proceeds if sold (after 6%)$74,447 – $97,203
Net of cash to close$54,574 – $77,329

The 7-year picture

Rent paid over 7 years (unrecoverable)$208,515
Equity position after 7 years$95,205 – $119,414

In the 3% appreciation case, your net sale proceeds pass the cash you put in around year 5. Every year after that, principal paydown accelerates while rent keeps rising 4% a year.

Want These Numbers Reviewed for Your Situation?

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Your information is used only to respond to your mortgage inquiry and is not sold. This is not a loan application and does not constitute any type of formal loan approval.

Rent vs. buy questions

For educational and illustration purposes only. Does not constitute any kind of formal loan approval, appraisal, or intent to make a loan of any type. Purchase price, monthly payment, cash to close, appreciation, and equity figures are purely estimated and will vary based on the actual property selected, county taxes, homeowners insurance, lender fees, credit, down payment, and the specific loan program you select. Home values can fall as well as rise; past appreciation does not predict future appreciation. Comparison excludes maintenance, repairs, and any tax benefits of ownership. Rent figures assume 4% annual increases.