Should you buy
or rent in 2026?
The honest answer depends on numbers most calculators ignore. Let’s work through yours.
Where are you looking?
You’re considering a home. The alternative is renting at . You plan to stay for .
Your scenario
Every month, your money goes somewhere. Here’s the side-by-side.
If You Buy
If You Rent
Buying costs $1,153 more per month. The renter invests that surplus. But only $1,950 of the buyer’s payment is “lost” to interest - the $325 in principal builds equity every month.
The upfront cost of buying is significant.
With a home and down, you need $90,000 for the down payment plus $13,500 in closing costs - $103,500 total upfront.
If invested in a diversified portfolio at average returns, that $103,500 could grow to $223,449 in 10 years. That’s real money left on the table.
But there’s another side. That money isn’t gone - it’s building equity in an asset that historically appreciates at per year. By year 10, your home could be worth $638,255 with $333,061 in equity. That equity is illiquid - you can’t spend it at the grocery store - but you can tap it via a HELOC or realize it when you sell.
The real question is which path builds more total wealth.
What about the mortgage interest deduction? Let’s calculate the actual number.
Itemizing beats the standard deduction by $1,926. At your 22.0% marginal rate, that saves you $424 per year in taxes.
This benefit decreases over time as you pay down the mortgage and interest shrinks. The calculator accounts for this year by year.
The Wealth Race
Over 30 years, who comes out ahead? With a mortgage and investment returns, here’s how it plays out.
Adjust your assumptions
With these assumptions, renting stays ahead for the entire 30-year period. This typically happens when investment returns are high relative to home appreciation, or when the rent-to-price ratio is favorable for renters.
What If You Leave?
Drag the slider to see how the outcome changes at any exit point.
If you sell in Year 10:
Buyer
Renter
Your Verdict
Over 10 years
Renting Wins
by $49,186
Breakeven Rent
$2,517
Rent above this = buying wins
Breakeven Year
30+
When buying overtakes renting
Renter Advantage
$49,186
At year 10
What matters most for your situation
Home appreciation
Helps buying by $55,255 per 1% more appreciation
Mortgage rate
Helps renting by $33,847 per 1% higher rate
Investment returns
Helps renting by $26,858 per 1% more return
A note on location: These results depend heavily on your local market. Property taxes, appreciation rates, and rent-to-price ratios vary dramatically by city. A home in Austin, TX (1.6% property tax, strong appreciation) produces very different results than one in San Francisco (0.7% tax, high rent-to-price ratio) or Chicago (2.1% tax, moderate appreciation). Adjust the inputs above to match your area.
Beyond the Numbers
Money isn’t everything. Here are the non-financial factors that calculators can’t capture.
Advantages
Building equity
Each mortgage payment builds ownership in an appreciating asset.
Stability & control
No landlord can raise your rent or ask you to leave. You can renovate, paint, and make it yours.
Hedge against inflation
Fixed mortgage payments stay constant while rents typically rise 3-5% per year.
Tax benefits
Mortgage interest and property tax deductions can reduce your tax bill (if you itemize).
Forced savings
Monthly mortgage payments build equity automatically - no discipline required.
Leverage
A 20% down payment gives you 5x leverage on home appreciation.
Community roots
Homeownership encourages putting down roots - schools, neighbors, local involvement.
Disadvantages
Illiquid asset
Home equity can't be spent at the grocery store. Accessing it requires selling or borrowing.
High transaction costs
Buying and selling costs (6-10% combined) eat into returns, especially for short holds.
Maintenance burden
You're responsible for every repair - roof, HVAC, plumbing. Budget 1-2% of home value annually.
Concentration risk
A single property in one location is the opposite of diversification.
Reduced mobility
Selling takes months. Job opportunities in other cities become harder to pursue.
Hidden costs
Property tax, insurance, HOA, utilities, and maintenance add 30-50% on top of mortgage payments.