Rent Vs Buy Calculators
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Among real estate-related calculators, one of the most difficult to accurately determine is the rent vs buy calculator, despite tremendous progress among calculators in this regard over the years. Below I'll go through a relatively typical example for Newport News using Nerdwallet's calculator on the subject. If you don't like Nerdwallet's, Realtor.com has one, as does the New York Times, although there's a subscription wall with New York Times you may encounter. The most important element of these calculators is to ensure that all details are accurate prior to making a determination based on the calculator. It's also important to keep in mind the wide variety of exceptions that can throw these calculators off that I mention on my rent or buy page.
1. Determine the monthly price of rent vs the monthly price of a comparable purchase. Ideally you want to accomplish this task by taking the median price of homes that fit your criteria for purchase and rent when you have a data set of at least 30 options for each (more is better). That said, sometimes the place that you might purchase or rent is with friends or some poorly advertised fantastic deal, so it's also possible to do it by individual properties, although it's very important that you try to compare apples to apples of similar quality/suitability properties of rent and purchase. Even if I generally recommend trying to get something "cheap" & lower quality more so when renting than buying, since renting is short term and can give you more time to build up a down payment if you do get something cheap but suitable, when making this comparison for calculation purposes, it is best to compare similar quality properties.