Investor Tools
Rent vs. Buy Calculator
Compare the true cost of renting against buying over any time horizon. Factors in mortgage principal and interest, property taxes, insurance, maintenance, home appreciation, rent increases, and the opportunity cost of your down payment.
Your Scenario
Net Cost — Buying
$207,880
over 10 years
Net Cost — Renting
$302,646
over 10 years
Breakeven Point
Year 5
buying becomes cheaper
Cumulative Net Cost Over Time
📈 Buying appears more cost-effective over your time horizon.
After 10 years, buying saves an estimated $94,766 net of equity and opportunity costs. Results depend heavily on your assumptions. Consult a financial advisor before making a decision.
Estimates only — for informational and educational use. Not financial, tax, legal, or investment advice. Consult a licensed financial advisor and lender before making housing decisions. See our Terms of Service.
How the Rent vs. Buy Calculation Works
The calculator models two scenarios over your chosen time horizon and shows the net cost of each path — accounting not just for out-of-pocket expenses, but also for the equity you build and the investment returns you give up by tying money into a down payment.
Buying costs include
- →Mortgage principal & interest (30-year fixed assumed)
- →Annual property taxes
- →Homeowner's insurance
- →Maintenance & repairs
- →Opportunity cost of the down payment
- →Minus equity built (appreciation + principal paydown)
Renting costs include
- →Monthly rent payments
- →Annual rent increases (inflation)
- →No equity accumulation
- →Full investment return on down payment equivalent
- →No maintenance or tax burden
- →Maximum flexibility
Florida-Specific Considerations
No state income tax
Florida has no state income tax — a major financial advantage that improves the effective cost of homeownership relative to high-tax states.
Homestead exemption
Florida homeowners who use the property as a primary residence can receive a homestead exemption of roughly $50,000 on assessed value (partly inflation-indexed, and excluding school taxes), reducing property taxes significantly.
Save Our Homes cap
Once homesteaded, annual property tax assessment increases are capped at 3% or CPI (whichever is lower) — protecting buyers from runaway tax bills as values rise.
Insurance premiums
Florida homeowner insurance rates are among the highest in the nation due to hurricane risk. Budget $2,000–$5,000+ annually depending on location and structure age.
The Breakeven Point
The breakeven year is when cumulative buying costs (net of equity) drop below cumulative renting costs. Before that year, renting may be cheaper. After it, buying has typically paid off. In Florida's high-appreciation coastal markets, breakeven often arrives in years 4–8. In slower markets, it may be year 8–12.
What This Calculator Computes
For each year of your time horizon it totals what renting costs and what buying costs net of the equity you build, then reports the first year buying comes out ahead (the breakeven year).
Renting = cumulative rent, with rent rising by the annual increaseBuying = down payment + cumulative (mortgage P&I + tax + insurance + maintenance) − principal paidNet buying = Buying + opportunity cost of the down payment − equity gainedOpportunity cost = Down Payment × ((1 + Investment Return)^years − 1)Equity gained = Home Value − Loan Balance − Down PaymentProperty tax and maintenance are charged as a percent of the home's value each year, so they grow as the home appreciates. The mortgage is a 30-year fixed loan at the rate you enter.
Worked Example With the Default Inputs
Hypothetical numbers for illustration, not a quote or a forecast. The assumptions:
- →Rent $2,200 a month, rising 3% a year
- →Home price $380,000 with 10% down ($38,000), 7.0% rate on a 30-year loan
- →Property tax 1.0% and maintenance 1.0% of home value a year, insurance $2,400 a year
- →Home appreciation 3.5% a year, 7.0% return on the money you would otherwise invest
- →Ten-year horizon
Change the appreciation and rent growth inputs and the breakeven year moves a lot. That sensitivity is the real lesson, not any one result.
Inputs and Limits
This is a cost-comparison model, not a forecast. The inputs that move the answer most, and what is left out:
Appreciation and rent growth
Small changes compound over the horizon. Run a low, a middle, and a high case before drawing a conclusion. The defaults are placeholders, not market predictions.
Investment return
Used only to price the down payment's opportunity cost. A higher return makes renting look better, and a return of 0% makes buying look better.
Fixed 30-year loan
The mortgage term is not an input. The loan is a 30-year fixed at the rate you enter, and no PMI is charged, so a down payment under 20% understates the cost of buying.
Not included
Closing costs, selling costs and agent fees, HOA dues, tax effects of owning, moving costs, and the extra savings a renter might invest each month. It also does not credit any homestead exemption unless you lower the tax rate yourself.
Frequently Asked Questions
What does the breakeven year mean?
It is the first year the calculator's net cost of buying drops to or below the cumulative cost of renting. If it shows none, buying does not catch up within the horizon you entered.
Why does buying look expensive in the first few years?
Early payments are mostly interest, the down payment earns no return in this model, and ownership costs like tax, insurance, and maintenance start immediately. Equity and appreciation accumulate more slowly.
Does the calculator include selling costs?
No. If you sell before the horizon ends, agent fees and closing costs would reduce what you keep, and the breakeven point would move later. Add them in your own head or compare a longer horizon.
How should I treat the Florida homestead exemption?
The Florida Department of Revenue says the homestead exemption can reduce a property's taxable value by roughly $50,000 (the first $25,000 applies to all levies, and an inflation-indexed additional amount applies to non-school levies) and qualifies the home for the Save Our Homes assessment limitation. Applications go through your county property appraiser. To see the effect here, lower the property tax rate input to reflect your expected bill.
Can I use this for an investment property?
It is built for a primary residence decision. For an income property use the cap rate calculator or the deal analyzer, which model rent, vacancy, financing, and hold-period returns.
Sources and As-Of Dates
- Florida Department of Revenue: Property tax exemptions: homestead exemption of roughly $50,000 (partly inflation-indexed) and the Save Our Homes limitation.
Sources last checked October 31, 2026. The cost model itself is arithmetic on your inputs and is not a legal or tax rule. Educational estimate, not financial, tax, or legal advice.
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