Everyone has an opinion on renting versus buying. “Rent is throwing money away.” “A house is a money pit.” Maya’s looking at a $350,000 house. A place like it rents for $2,300 a month. Let’s run it.
What owning really costs
With 10% down at 7.25%, the mortgage is only part of it. Add property tax, maintenance and insurance, and owning costs $2,863 a month in year one. Plus $35,000 down and about $10,500 in closing costs.
The fair comparison
The renter invests what the buyer spends: the down payment, the closing costs, and the extra $563 a month. That’s what the calculator does.
The result, at 8%
| Stay | Winner |
|---|---|
| 5 years | Renting saves $18,458 |
| 7 years | Renting saves $11,260 |
| 10 years | Buying saves $2,294 |
| 20 years | Buying saves $83,508 |
Short stays: buying and selling costs eat the gains. Long stays: rent keeps rising, and the mortgage payment doesn’t.
The Honest Check: 6%
Renting only wins if the renter really invests the difference, and earns 8% on it.
| 7 years | |
|---|---|
| At 8% | Renting saves $11,260 |
| At 6% | Buying saves $2,943 |
And if the renter spends the difference instead of investing it, buying wins far sooner.
The calculator also leaves out PMI (usually required under 20% down) and life: a job across the country, a growing family. If you might move within about seven years, renting is usually the safer bet.
CPA note from Daryl (tax year 2026)
The mortgage-interest deduction only helps if you itemize, and the 2026 standard deduction is $16,100 single, $32,200 married filing jointly. Many first-time buyers never itemize. When you sell your home, up to $250,000 of gain is tax-free ($500,000 married) if you owned and lived there 2 of the last 5 years.
Renting isn’t throwing money away, and buying isn’t automatic wealth. Your number of years decides it.
Next up: Marcus’s car is paid off, and he wants a new truck at $761 a month.
How the math works
QWOS Rent vs Buy Calculator: $350,000 home, 10% down, 7.25% 30-year fixed, 3% appreciation, $2,300 rent rising 3% a year, investment return 8% (then 6%), calculator defaults for property tax, maintenance, insurance, closing (3%) and selling costs. Rate context: 30-year average 7.32% (Trading Economics, Oct 22, 2026). Tax figures: CPA Practice Advisor, 2026.
Education, not financial or tax advice. Hypothetical returns; real results vary.