When does buying become cheaper than renting?
Break-Even Point
Year 11
~132 months
Equity at Break-Even
$335K
principal + appreciation
Total Cost to Break-Even
$760K
buying vs renting
Monthly Advantage After
$1,200+
increasing over time
If you plan to stay ≥ 11 years, buying becomes financially
superior. The equity accumulated and appreciation potential outweigh the higher monthly costs after this
point.
Break-even is sensitive to rent growth, interest rates, and home
appreciation. A 1% change in any can shift break-even by ±1–2 years.
Assumes 3% rent growth, 4% mortgage rate, 1% property tax, 0.5% insurance, 1% maintenance, and 2%
annual appreciation.