Rent vs Buy · Updated June 2026
Rent vs buy in San Diego
San Diego in 2026: a typical centre apartment costs about $740,000 to buy ($8,700/m²) or $2,900/month to rent. With 20% down at 6.3%, the mortgage runs $3,664/month – but the true owner cost is $5,762/month once property tax (0.75%), maintenance, insurance, and HOA fees are added. On our 10-year model, renting and investing the difference wins for the entire period modeled.
The price-to-rent ratio tells the structural story: San Diego's ratio of 21 sits in the contested middle where personal factors (horizon, stability, rates) decide. A renter who invests the $2,862/month difference plus the $148,000 down payment at 7% builds $721,899 over 10 years versus the buyer's $471,443.
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
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
- Typical buy $740,000 vs rent $2,900/mo – price-to-rent ratio 21.
- All-in owner cost: $5,762/mo vs $2,900 rent.
- 10-year outcome: buyer $471,443 vs renter $721,899.
- No breakeven within 10 years at 6.3% – renting wins this window.
- Income check: owner cost wants ≥ $17,461/mo net income.
| Year | Buyer net worth | Renter net worth (invested) | Buying advantage |
|---|---|---|---|
| 1 | $127,159 | $212,699 | -$85,540 |
| 3 | $193,002 | $304,944 | -$111,942 |
| 5 | $264,481 | $407,899 | -$143,418 |
| 7 | $342,125 | $522,976 | -$180,851 |
| 10 | $471,443 | $721,899 | -$250,456 |
The San Diego numbers under the model
Inputs (2026, adjustable in the calculator): purchase $740,000, 20% down, 6.3% 30-year fixed, rent $2,900/month growing 3%/year, home appreciation 3.5%/year, market return 7%/year, 0.75% property tax, 1% maintenance, ~7% selling costs at exit. The buyer's wealth lives in equity (principal + appreciation minus exit costs); the renter's lives in the invested down payment and monthly differences compounding.
Early years punish buyers everywhere: at 6.3%, roughly 85% of the first year's payments is pure interest, while ~3% buying costs and ~7% future selling costs must amortise before equity wins. That's why short horizons (under 8 years here) favour renting in San Diego regardless of headlines.
What flips the answer
Rate sensitivity: at 4.8% the breakeven moves into buying territory; at 7.3% renting wins even longer. Down-payment opportunity cost matters just as much – if your alternative to buying is cash at 2%, not stocks at 7%, buying improves sharply.
Stability is the unpriced variable: owners are insulated from San Diego's rent growth ($2,900 today is $3,897 in 10 years at 3%) but pay dearly to move early. The honest rule for San Diego: buy when your horizon comfortably exceeds 10 years and the payment fits under 33% of net income – $17,461/month of take-home for this scenario.
FAQ
Frequently asked questions
Is it better to rent or buy in San Diego right now?
On 2026 numbers ($740,000 purchase, $2,900 rent, 6.3% rates), renting and investing the difference wins for the entire period modeled. Horizons shorter than that favour renting; longer ones favour buying – run your own inputs above.
How much do I need to buy in San Diego?
For a typical $740,000 purchase: $148,000 down (20%) plus ~3% closing costs ≈ $170,200 cash, and an all-in carrying cost of $5,762/month – comfortably supported by $17,461+/month of net income.
What is the price-to-rent ratio in San Diego?
About 21 ($740,000 ÷ $34,800 annual rent). Above ~22 renting+investing historically wins; below ~16 buying does; between is horizon-dependent.
Does the model include all ownership costs?
Yes: mortgage at 6.3%, 0.75% property tax, 1%/year maintenance, insurance, $350/month HOA, ~3% buying and ~7% selling costs – the lines most "rent is throwing money away" arguments skip.
What if rates fall?
Each 1-point rate drop cuts the payment ~$377/month on this purchase and pulls breakeven earlier. Buying at high rates with a refinance option has asymmetric upside – but never underwrite the purchase on the refi you might get.
More on San Diego
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