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Rent vs Buy · Updated June 2026

Property Tax Escrow Fluctuation Calculator

The rent-vs-buy verdict lives in the costs nobody puts on the listing: maintenance (~1% of value/year, arriving in lumps), the big-five component replacements ($250–$625/month of silent depreciation – table below), property tax and its reassessment shocks, insurance inflation, HOA trajectories, and the ~10% round-trip transaction toll. Stack them honestly and the all-in cost of a $450,000 home runs $1,200–$2,000/month beyond the mortgage payment.

Escrow shock is the first-year rite: lenders re-analyse annually, and reassessment + insurance hikes commonly add $200–$500/month in year two – the "fixed payment" was the principal and interest, never the total.

None of this makes buying wrong – it makes naive mortgage-vs-rent comparisons wrong. The calculator on this page carries every line as an explicit, editable input, which is the only honest way to run the comparison for your specific house, state, and HOA.

Rent vs buy calculator · 2026

Verdict at your horizon

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Mortgage P&I
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Owner all-in /mo
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Cash needed upfront
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PMI
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Buyer net worth
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Renter net worth
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Interest paid by then
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Price-to-rent ratio
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Net worth year by year

Buying Renting + investing

Renter invests the down payment + closing costs + monthly difference at your chosen return. PMI of 0.55%/yr is added automatically while the down payment is under 20% and equity is below 20%. Price-to-rent under ~15 usually favors buying; over ~20 favors renting.

Key insights

Key insights

  • True owner cost ≈ mortgage + $1,200–$2,000/mo of non-equity lines ($450k home).
  • Component depreciation: $250–$625/month even when nothing breaks.
  • Reassessment-on-sale reprices taxes 30–80% above listing claims.
  • Round-trip transaction toll: ~10% – $50,000 on a $500,000 home.
  • Owner's non-equity spending is the number to compare against rent.
Major home component replacement costs & lives (2026)
ComponentReplacement costTypical lifeMonthly reserve
Roof (asphalt → standing seam)$12,000–$30,00020–30 years$50–$100
HVAC system$8,000–$18,00015 years$45–$100
Water heater$1,800–$4,50010 years$15–$38
Exterior paint / siding$8,000–$25,00010–15 years$55–$140
Windows (whole house)$12,000–$35,00025 years$40–$115
Kitchen appliances (set)$4,000–$12,00012 years$28–$83
Driveway / flatwork$5,000–$15,00025 years$17–$50
Total silent depreciation––$250–$625/month

Sizing each cost line for real

Maintenance: 1%/year long-run average, scaled up for age (pre-1980: 1.5–2×), harsh climates, and low-price/high-size homes. Property tax: your state's effective rate on YOUR purchase price (reassessment on sale catches new buyers 30–80% above listing-stated taxes in many jurisdictions). Insurance: $1,200–$4,000/year baseline nationally, multiples of that in FL/CA/TX catastrophe zones – with +8–12%/year trajectories there.

HOA/condo fees: take the current fee, check the reserve study (under-30%-funded = special assessments queued), and model +4–6%/year growth. Transaction costs: ~3% in, ~7% out – $50,000 round-trip on a $500,000 home that must be out-appreciated before the first dollar of true gain.

What renters can skip (and what they can't)

The renter's cost stack is rent + insurance ($15–$40/month renter's policy) + utilities – full stop. Maintenance, components, taxes, assessments, and exit costs are the landlord's problem, priced into rent imperfectly: in high price-to-rent markets, landlords structurally under-recover these costs, which is precisely when renting is the subsidised side of the trade.

The fair-comparison rule: every dollar the owner pays that builds no equity (interest, tax, insurance, maintenance, HOA, depreciation reserves) is "rent" by another name. Compare that figure – not the mortgage payment – to actual rent, then let the calculator compound both sides' savings honestly.

FAQ

Frequently asked questions

How much does home maintenance really cost?

Long-run: ~1% of home value annually ($4,500/year on $450,000), arriving in lumps – quiet $800 years and $18,000 roof years. Older homes, harsh climates, and large-cheap houses run 1.5–2× the rule.

What are the biggest hidden ownership costs?

In typical order of surprise: component replacements ($250–$625/month amortised), reassessment-driven tax jumps, insurance inflation (brutal in FL/CA/TX), HOA growth + special assessments, and the ~10% round-trip transaction toll.

How much should I keep in a repair reserve?

Sum each component's replacement cost ÷ remaining life – typically $350–$600/month for a single-family home. Alternative shortcut: hold 1–1.5% of home value liquid and replenish after every draw.

Do HOA fees make condos bad buys?

Not automatically – fees fund real costs houses also carry. The kill criteria: fees above ~0.8%/year of unit value, reserves under 30% funded, or fee growth outrunning rents. At $500/month, the NPV of the fee stream alone exceeds $85,000.

Why do these costs change the rent-vs-buy answer?

Because they're 30–50% of true ownership cost and 0% of the mortgage-vs-rent comparison most people run. Adding them moves typical breakevens from "2–3 years" (naive) to the honest 5–10, and flips high-ratio markets to renting outright.

Keep exploring

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