← Guides · November 8, 2026
When Does Buying Beat Renting? The Break-Even Year in Five Scenarios
Take a $400,000 home, 20% down, a 6.5% 30-year mortgage ($2,023 a month), property tax 1.1% and upkeep 1% of value per year, 3% appreciation, 3% buying and 6% selling costs. Against it, $2,200 rent rising 3% a year, with the down payment and monthly savings invested at 5%.
In this base case buying pulls ahead in year 7. After 5 years the renter is still ahead ($148,000 against $137,000), and after 10 years the buyer leads ($236,000 against $204,000).
Now change one thing at a time:
| Scenario | Buying wins from |
|---|---|
| Base case | Year 7 |
| Mortgage rate 5.5% | Year 5 |
| Rent $2,800 | Year 3 |
| Rent $1,800 | Year 21 |
| Appreciation 1% | Year 18 |
Takeaways
- Rent relative to the mortgage drives everything. Rent far below owning costs can make buying a decades-long wait.
- Selling costs punish short stays. If you might move within five years, the base case says renting is ahead.
- Appreciation is the swing factor and the one nobody can forecast, so test a low value.
Run your own case in the calculator.