Rent vs. Buy Calculator

Choosing between renting and buying a home in New York City is a significant financial and personal decision. While homeownership is often considered a part of the American Dream, it may not be the best option for everyone. Our buy vs. rent calculator can assist in determining the monthly costs of both options and help you make an informed decision about what is best for your future.

It’s important to note that owning a home typically yields capital appreciation after 5-7 years, which often makes buying an NYC apartment less expensive than renting in the long run. Our calculator considers this factor, providing valuable insight into the financial implications of both options.





Your mortgage payments over years will add up to .

Your rent payments over years will add up to .

Based on your inputs,

ELIKA New York: Real Estate Calculators


Buying vs. Renting

You can get some money back or even make money off your apartment by owning your home in simpler terms. By owning your home, you have the potential for capital appreciation, tax deduction, and property taxes. But buying an apartment requires a down payment, closing costs, monthly mortgage payments, property taxes (which tend to rise yearly), possible renovation costs, and home insurance.

Renters typically pay less per month, and the savings can be; invested. To sign a lease, the renter must pay; the first month’s rent and security deposit and usually require renters insurance. There is also the potential for, usually annually, about 3%.

Rent vs. Buy, Do The Math

Our buy vs. rent calculator is excellent and helps determine how long it would take to own your home before making financial sense. This year, the median for New York City was 4.9 years, at 7.4 years in Manhattan, 4.4 years in Brooklyn, and three years in Queens. There are also wide variations from the differing neighborhoods. It is a complicated calculation, with assumptions including investment rates of return and home price appreciation. If you are not mathematically inclined and find all of that too difficult, there is a more straightforward approach.

If you plan on staying in the city for only a short period, renting is undoubtedly the better option. Mainly due to the flexibility and closing costs. But, if you plan on staying in the same place for several years, it would be wise to do a back-of-the-envelope calculation. Factors to consider are the home price, how long you plan to stay, and the mortgage interest rate.


A simple example is a $1.5 million purchase price, placing a 20% deposit, the mortgage is $1.2 million, and the monthly payment (principal and interest) is about $5,400, assuming a 3.5% interest rate.

There are maintenance/standard common charges and utilities if this is a co-op or condo. If these come to $2,500, your monthly cost is $7,900.

It likely far outweighs the average rent in the city. However, a portion of your monthly mortgage payment is applied to the principal, and the interest is tax-deductible.

In the early years, the payment will primarily be paying down interest. The payment amount may bring your monthly cost down to $6,000.

Considering it is still a higher price than renting, you may choose ownership for the potential price appreciation and the pride from staking your claim.

Of course, if you can invest that $300,000 down payment at a higher enough return, perhaps you’re better off with the renting option for a period. Instead of considering or renting or buying, it turns into an analysis of homeownership vs. opportunity cost.

Is It Better to Buy or Rent in NYC?

Buying vs. renting a New York City apartment is intensely personal. Although part of the American Dream includes homeownership, it is not the right choice for everyone. At what threshold does it make more sense financially and for your lifestyle to buy an apartment instead of renting one?

There are pros and cons to both – factor in monthly payments, a down payment, the investment aspect of buying, and the flexibility and mobility of renting. Most importantly, being a renter vs. being a buyer is a personal choice. Individual circumstances often dictate the decision. The real estate market and having enough money for the down payment and monthly expenses are critical. How long you plan to live in an apartment also weighs heavily.

In New York City, nearly 70 percent of its residents rent vs. buy apartments. Because of the high cost of buying and the long-term commitment to staying in one place. If you are not living in a rent-stabilized apartment, you’re paying excessive monthly rent. If this is the case, buying might be an option to consider.

Buy vs. Rent in NYC: How to Decide 

Buying and renting offer the same pros and cons in New York City as in other cities. There are, however, additional variables involved with NYC. The most important is to have a clear understanding of the costs and benefits of each. 

We’ve broken down each of these factors to help you decide the best option for you.

Before deciding, ask yourself a few questions:

  • How long do I want to live in New York City?
  • How long would I want to live in this neighborhood? Consider your career, your family, etc.
  • How many bedrooms would I need?
  • How much can I put for a downpayment if I purchase an apartment?
  • Am I in any debt? Could I handle more with a mortgage?
  • What features are you looking for in a home?

When Buying is Better

When you’re sure, you want to stick around.

If you’re sure you want to stay in New York City and are financially ready, it may be time to switch to buying. Long-term renting is more expensive than a mortgage. You’ll also get a tax break on the interest you pay toward your mortgage. Overall, spending less per month on a place to live is ideal. After all, paying less for the same property makes sense, especially when you know you want to make New York your permanent home.

Mortgages stay the same year after year when fixed. In a few years, what you’re paying for your mortgage will be “frozen in time” compared to the rising rents of similar properties.

When you can get a good ROI

Buying pays off financially when purchasing gives you a decent investment return (ROI). Whether you’re looking for your forever home or an investor looking for another rental, you need to ensure the property in question will profit you in the long run. To make sure you’re making the right purchase, confirm that it satisfies these qualifications:

  • Is it in an area that has seen a steady increase in value?
  • Is it in a location that is appealing to others? For instance, is it convenient to amenities like the subway/public transit and local shopping?
  • Does it have evergreen appeal in case you plan to resell?
  • Is it in good condition, or does it need a lot of TLC?

The best way to maximize your chances of finding the right place is to get an agent to scout out your needs’ best properties. Property in excellent condition is generally appealing and likely to grow in value due to its location and amenities is one to snag. On the other hand, any transaction where you’re losing money isn’t one to pursue.

When you want your place

If you’re unhappy with renting for various reasons, whether the lack of freedom to renovate or the intrusive inspections, becoming a homeowner can make you more comfortable.

Owning your home will give you higher control over your life. You also don’t have to continually renew leases and abide by specific terms (like pet restrictions, etc.). Call a realtor and see your buying options if you’d be happier being the #1 person in charge of your estate.

Tax deductions

The number one reason to consider buying vs. renting is the tax deductions. Any interest you pay on your mortgage loan is deductible from your gross income, as is a portion of your monthly maintenance. Your mortgage and maintenance could save you thousands of dollars in yearly taxes, which means less paid to the IRS and more money in your pocket.

A resilient market

Even in a recession, prices hold reasonably steady in desirable areas of town. Manhattan prices might have dipped in 2020, but they historically recover faster than any other real estate market. Today, NYC apartment prices are close to all-time highs, which signifies that homes in the city will remain a profitable investment over the long term.

Interest rates

Interest rates are hovering around four percent in the metro area, so depending on how much you pay per month in rent, you could spend less if you own. Coming up with the down payment is no easy feat, but if you have a nest egg and can continue adding to it, or you’ve sold property elsewhere and made a profit, then looking into buying it might be worth your while.

No rent increases

The beauty of a fixed-rate mortgage is that your monthly note will remain the same until you sell the apartment or pay it off. Your maintenance, however, will increase annually since building taxes and operating costs will also increase.

Building equity from day one.

Manhattanites pay an average of $5,000 monthly in rent. It is not a good feeling when you realize you’re not writing a big check to a management company or landlord every month rather than building equity immediately (no matter how small).

The vacancy rate.

New York’s vacancy rate stays unbelievably low. Currently, it’s at about one percent, which means scoring a great rental in your preferred area of town might be next to impossible. Depending on your needs and when you start your apartment search, you’ll probably have more sale options; then, you will find rental opportunities.

When Renting is Better

Are you moving to New York soon? You might want to rent vs. buy first. Writing a check each month but showing nothing for it –– other than a depleted bank account at the end of your tenure – may seem like a losing proposition. But while this holds in most cities, the real estate minutia in New York City is a different animal. Renting an apartment for at least a year or two, possibly longer, may be wiser than you think, and here’s why.

A big city with many neighborhoods

Considering the size of New York City and the unique characteristics of every borough and neighborhood, you’ll need to figure out where you want to eat, sleep, and socialize, particularly if you’re new to New York City. Take Brooklyn, for instance. The industrial vibe in Red Hook remains far removed from the stroller-filled, tree-lined streets of Park Slope.

Likewise, downtown Manhattan enclaves like the West Village and the Lower East Side offer top-notch restaurants and sizzling nightlife. At the same time, the Upper West Side promises uninterrupted acres of green space in Central Park. For this reason, uptowners travel to the south of 23rd Street when looking to try a hot, new eatery or even savor a meal from an old, reliable standby.

Meanwhile, downtowners head north for outdoor concerts, long training runs, and relaxing lounges on the Great Lawn.

New York City might not be for you.

As glamorous as it sounds, living in New York City isn’t always easy, and daily life here is nothing like visiting for a few days or even subletting for a few weeks. Although returning home to your apartment will most likely be more comfortable than staying at a bustling hotel, on the flip side, after a few days in this chaotic city, know that you’re hopping on a flight to a quieter, more restful, probably, less expensive place.

Even if you love New York, you’ll know if you can accept the city and survive here over the long haul only if you’ve lived in it daily. And trust me, this is one of the reasons that the city is transient. Thousands come each year to leave months later because they have discovered that New York is harder to hack than they had thought.

Renting is quicker than buying.

Although rent vs. buy is far from painless, purchasing real estate in the Big Apple is a long, grueling process, including visiting dozens of open houses, scouting apartment buildings, submitting financials, interviewing with co-op boards, etc. You’ll probably have a long list of things to worry about during your long-distance move, and buying a home could be more than you need to tackle, especially if you’re moving from an international location.

Live in New York as a renter and get acquainted with the city before buying. If you’ve called NYC home in the past and know the neighborhoods well, or you’ve owned them previously and found yourself content in a particular area of town, you may be an exception. Then, by all means, invest in New York’s almost bulletproof market and start building equity.


Many city dwellers value their flexibility and freedom. Renting allows tenants to make a short-term commitment to a neighborhood and offers a particular lifestyle.

If you’re new to the city, it can be hard to understand that a second-floor apartment in Hell’s Kitchen does not offer the same serene feeling as a 20th-floor Upper East Side apartment. If you’re unsure which neighborhood you want to live in or how long you’ll be in New York, renting is the way.

It also applies to your family — or lack thereof — situation. If you’re single but wish you weren’t, buying a studio might not be the best long-term investment. If you’re newly married and trying for kids, you might be looking to upgrade to that 2-bedroom or even move to the suburbs soon.

In short, renting is a better choice than buying if you’re not looking to stay in the same place for at least two to three years.

You can rent an apartment quickly.

Although renting still requires a lot of paperwork, buying real estate in New York can take months. Buying is a grueling process that includes visiting dozens of open houses, scouting apartment buildings, submitting and interviewing with co-op boards, home inspections, etc.

If you need a place too quickly, renting an apartment can be done in a couple of days if you’re willing to compromise.

You don’t need to spend money on upkeep.

When you buy an apartment, the upkeep is your responsibility. You must pay for the repairs if the toilet floods the downstairs apartment. When a paint job is necessary, you’re buying the paint.

These responsibilities ultimately fall on your landlord and management company when renting an apartment.

Is it Better to Buy vs. Rent?

Buying is almost always a better long-term decision if you can afford it. Your monthly mortgage payment will likely come back to you through capital appreciation when selling. You’ll also receive more tax benefits from owning your home. The federal government subsidizes a considerable part of homeownership by making most mortgage payments tax-deductible.

In New York, there will always be a demand for real estate, making your new home a vital investment piece for you.

Rent payments are just monthly expenses that do nothing to build your wealth. But be careful before jumping into homeownership. First, if there is any real chance of defaulting on your debt, you should remember that doing so can ruin you financially for many years. A good rule is not to have your debt-to-income ratio surpass 25%.

But if you can afford it and know you will be in the city for a while.

The Buying vs. Renting Bottom Line

If you’re living in New York City and happy with renting, you may wonder when you will prosper from owning your own. Many people feel the desire to call their home truly their own. Also, the investment aspect of owning an apartment is appealing. The simple answer is if you’re in a financial position to buy a home, buy vs. rent is cheaper over the longer term and the wiser investment. At the same time, you can save over time by buying vs. renting; essential to be aware of the additional costs of purchasing a piece of New York City.

Once you are a homeowner, you will be responsible for paying New York City property taxes (some of the highest in the U.S.) and homeowners’ insurance. Maintenance fees or standard common charges are widespread, which New York City homeowners are responsible for paying.