What makes buying cheaper or more expensive than renting?

Beyond the mortgage, owners pay property tax (varies 7x between states), insurance, maintenance, and closing/selling costs, but build equity and may gain from appreciation. Renters avoid those but pay rising rent and forgo the investment of their down payment elsewhere. The breakeven is where owning becomes cheaper than renting over time.

Why does state property tax matter so much here?

Property tax is a permanent, large owner cost. At a 1.95% effective rate (Illinois) versus 0.27% (Hawaii), the same $400k home owes roughly $6,700 vs $1,080 per year — which can flip the buy-vs-rent math. This tool uses verified 2026 effective rates per state.

What is the "opportunity cost" line?

The down payment you hand to a seller could instead be invested. We compare owning’s cash drain against the growth your down payment would earn at your assumed investment return. A higher return makes renting relatively more attractive.

How is the breakeven year computed?

We simulate the 30-year mortgage month by month, subtract recovered equity (future home value minus selling costs minus loan balance) from total owner outlays, and compare to renting plus the grown down payment. The first year where owning costs less is your breakeven.

Interactive Estimator

Buy vs Rent Breakeven Calculator (2026)

AI answer boxes give you a raw mortgage payment — but they never fold in your state’s property tax, maintenance, or the fact that your down payment could be earning elsewhere. This tool does all four and finds your real breakeven year.

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Home price ($)

Down (%)

Mortgage rate (%)

State (prop. tax)

Rent ($/mo)

Years to stay

Insurance ($/yr)

Maintenance (%/yr)

Invest return (%)

Apprec. (%/yr)

Buy vs Rent Breakeven (2026)

allmoneycalc.com — estimate, not financial advice

Compares true cost of owning vs renting including verified 2026 state property tax, mortgage, insurance, maintenance, and down-payment opportunity cost.

The housing money cluster

Property Tax by State — the verified rates behind this tool
Home Affordability Calculator
Rent Affordability Calculator
Cross-State Take-Home Comparison — if the move is cross-state

Loan Amortization Calculator
Child Care Cost by State — a major relocation factor

Educational estimate, not financial advice. Assumes a 30-year fixed mortgage, constant rates, and that the home is sold at the end of the hold period. Property tax uses the verified 2026 state effective rate on owner-occupied housing; actual local rates and assessments differ. Investment return, appreciation, insurance, and maintenance are user assumptions. Closing and selling costs default to 3% and 6%. Verify with a lender, CPA, or fee-only planner. Source: Tax Foundation Facts & Figures 2026 (property tax rates).

Data sources & methodology

Standard formulas Amortization, compound interest, and retirement projection equations per finance practice.

Public reference rates Savings/investment assumptions stated as planning estimates; no live market rates.

Internal editorial Calculators reviewed by the AllMoneyCalc editorial team before publication.

Methodology and citations are maintained by the AllMoneyCalc editorial team. Where an official schedule is not yet loaded, results are shown as model estimates and the source is stated as a reference.

Buy vs Rent Breakeven Calculator (2026)

Compare buying vs renting

The housing money cluster

Data sources & methodology

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Buy vs Rent Breakeven Calculator (2026)

Compare buying vs renting

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Data sources & methodology

Related tools from our network

Money & tax

Vehicle & insurance

Life events