"Renting is throwing money away" skips half the math. Owners also have costs they never get back. A fair comparison puts those side by side.
1. Compare unrecoverable costs, not payments
For renters, it's mostly rent and renters insurance. For owners, it's mortgage interest, property tax, insurance, maintenance, and the opportunity cost of the down payment. Principal repayment isn't in this list, because that's savings you keep.
2. Budget maintenance realistically
A common rule of thumb is about 1% of the home's value per year for maintenance and repairs, more for older homes. A $350,000 home suggests roughly $3,500 a year, or about $290 a month.
3. Count buying and selling costs
Closing costs when you buy and agent and transfer costs when you sell can add up to a meaningful share of the price. Spread over two or three years they're heavy; over ten years they matter far less. This is why how long you plan to stay often decides the answer.
4. Include what the down payment could earn
Money in a down payment isn't invested elsewhere. Putting a modest expected return on it keeps the comparison honest.
5. Run your own numbers, then add a margin
Use your actual rent, a real quote for the mortgage rate, local property tax and insurance. If the result is close, the non-money factors (flexibility, stability, wanting to renovate) can decide it.
Free tools
- Rent vs. buy calculator
- Rent vs. buy a house (full guide)
- How much house can I afford calculator
- Down payment calculator
- 42 free budget templates, pay what you want ($0 is fine)
General information, not personal financial advice.