The rent vs. buy decision is more nuanced than ever in 2026. With home prices, interest rates, and rent all having shifted significantly, the math looks different than it did a few years ago. Let's break it down.
The Core Question
Buying isn't always better than renting—and renting isn't just "throwing money away." The right choice depends on:
- How long you'll stay
- Local price-to-rent ratios
- Your financial situation
- Lifestyle priorities
- Investment alternatives
Run Your Numbers
Get pre-approved to understand exactly what you can afford, then compare to rental costs in your area.
The True Cost of Owning
Monthly Costs Comparison
$600,000 home with 10% down, 5% rate:
| Cost | Monthly Amount |
|---|---|
| Mortgage payment | $3,145 |
| Property tax | $500 |
| Insurance | $150 |
| Maintenance | $500 |
| Total ownership costs | $4,295 |
Renting equivalent unit:
| Cost | Monthly Amount |
|---|---|
| Rent | $2,800 |
| Tenant insurance | $30 |
| Total rental costs | $2,830 |
Monthly difference: $1,465 more to own.
But What About Equity?
Ownership Equity Building
| Portion | Amount | Percentage |
|---|---|---|
| Interest | $2,250 | 72% |
| Principal | $895 | 28% |
Key insight: Early in your mortgage, most payments go to interest.
The "Rent Is Throwing Away Money" Myth
Owners also "throw away" significant money on non-equity expenses.
The Investment Alternative
5-Year Scenario Comparison
Result: Buying wins by ~$56,000 in this scenario.
The Break-Even Timeline
Market-Specific Factors
Common Mistakes
Buying Mistakes
| Mistake | Consequence |
|---|---|
| Buying for short stay | Transaction costs eat equity |
| Stretching budget | House poor |
| Ignoring maintenance | Repair surprises |
| Comparing mortgage to rent | Miss ownership costs |
Renting Mistakes
| Mistake | Consequence |
|---|---|
| Not investing difference | Lost wealth growth |
| Lifestyle inflation | No savings |
| Ignoring rent growth | Budget pressure |
FAQ
Q: Is renting really throwing money away?
A: No. You're paying for flexibility and reduced risk.
Q: Should I wait for prices to drop?
A: Focus on affordability, not market timing.
Q: What if I can barely afford to buy?
A: Renting and saving may be the smarter move.
What's Next
Get pre-approved and compare real numbers for your city.
Explore Your Options
Get pre-approved to understand what you can afford, then compare to rental alternatives.
