The case for buying
- Equity grows as you pay down your loan, and possibly as your home's value rises
- A fixed-rate payment keeps principal and interest the same for the life of the loan
- You can renovate, paint and make the home your own
- More stability: no landlord deciding to sell or raise the rent
The case for renting
- Less cash upfront, usually a deposit and first month's rent
- Easier to move for a new job or life change
- Major repairs are usually the landlord's job
- Your monthly costs are more predictable in the short term
Monthly cost side by side
Hypothetical example. APR may differ; example only. Rates change daily.
Say rent is $2,200 a month. Compare that with buying a $350,000 home with 5% down on a 30-year fixed loan at 6.75%. Principal and interest is about $2,157. Add $350 for taxes, $120 for insurance, $130 for PMI and $300 set aside for upkeep, and the full monthly cost is about $3,057.
Example details: $332,500 30-year fixed at 6.750% (7.150% APR): 360 monthly payments of $2,156.59, plus $130.00 a month of mortgage insurance for the first 139 payments. Purchase price $350,000 with a $17,500 (5%) down payment. Principal, interest and mortgage insurance only; taxes and insurance not included, so the actual payment will be higher. Unless noted, APR assumes ZERO Closing Costs, no discount points and 15 days of prepaid interest. Hypothetical example prepared November 4, 2026, not a current CapCenter rate offer; subject to credit approval.
Owning costs more each month in this example. Part of the difference builds equity, though. Over the first five years, you'd pay down about $20,000 of principal, before any change in home value.
- Renting: rent, renters insurance and sometimes parking or pet fees
- Owning: principal and interest, taxes, insurance, PMI, HOA dues and maintenance
Costs owners sometimes forget
- Repairs and maintenance: many owners plan on 1% to 2% of the home's value a year
- HOA dues, if the home has an HOA
- Higher utilities in a larger home
- Furniture, tools and yard care
Upfront costs
Buying needs a down payment, escrow deposits, prepaid interest, your first year's homeowners insurance and moving costs. With ZERO Closing Costs, CapCenter pays for or waives many of the lender and third-party fees that often add thousands to a purchase (restrictions apply). Renting usually needs a security deposit and first month's rent.
The break-even horizon
Buying tends to win when you stay long enough for equity and any appreciation to outweigh the costs of buying and later selling. That's often several years, depending on home prices, rents and rates in your area. If you expect to move within a couple of years, renting may cost less.
Beyond the numbers
- Stability and control over where you live
- Freedom to renovate
- Flexibility to move for work or family
- Time and energy for maintenance