Rent vs buy a $900k house
Over 30 years, buying a $900k home comes out about $558,897 ahead — comparing buying (20% down, $180,000) against renting at $4,500/month and investing the down payment plus any monthly savings. Both paths start with the same money; the difference is where it goes.
Net worth over time: rent vs buy
Both start at age 30 with enough for the $180,000 down payment. The renter invests it (and any monthly difference) at 7%; the buyer puts it into a $900k home appreciating 3%/yr with a 30-year mortgage. In today's dollars:
| Age | Rent & invest | Buy |
|---|---|---|
| 30 | $223,828 | $219,804 |
| 35 | $505,950 | $560,745 |
| 40 | $844,513 | $967,186 |
| 45 | $1,251,493 | $1,453,316 |
| 50 | $1,741,352 | $2,036,207 |
| 55 | $2,331,571 | $2,736,427 |
| 60 | $3,043,277 | $3,602,174 |
What actually drives the answer
Rent vs buy is rarely about "throwing money away on rent." It hinges on a handful of levers this projection captures:
- Price-to-rent ratio. Here a $900k home is compared to $4,500/month rent. Where rent is cheap relative to prices, renting-and-investing can win; where buying is cheap relative to rent, owning pulls ahead.
- How long you stay. Buying carries big upfront costs (down payment, closing) that take years to earn back. The crossover in this scenario is around age 31. Move sooner and renting often wins.
- The invested difference. Renting only wins if you actually invest the down payment and monthly savings — not spend them. This model assumes you do.
Assumptions: 20% down, 6.5% mortgage, 30-yr term, 3% home appreciation, 1.1% property tax, 7% investment return, 3% inflation, single filer, no-income-tax state. Your local prices, rent, and how long you'll stay change the answer — model yours in the calculator.
Putting most of your net worth on one street
A home at this price often becomes the single largest item on a household's balance sheet, which quietly turns a housing choice into a concentration bet. Instead of a diversified mix of assets, a large share of net worth sits in one property, in one neighborhood, in one local economy — undiversified and hard to sell in a hurry.
That matters because a house is illiquid in a way a portfolio is not. You cannot sell a bedroom to cover an emergency; exiting means months on the market and an agent commission of roughly six percent. If a job loss or a local downturn arrives at the same moment you need to sell, those risks are correlated — the value of the home and your ability to keep it can fall together.
Renting keeps the equivalent capital liquid and spread across many holdings, which is worth something real even when buying looks cheaper on a spreadsheet. Owning still offers a fixed, inflation-hedged housing cost — just recognize the trade you are making between that stability and diversification.
Common questions
Is it better to rent or buy a $900k house?
Over 30 years in this projection, buying comes out about $558,897 ahead — buying ends around $3,602,174 vs renting-and-investing around $3,043,277. It flips based on how long you stay, local price-to-rent, and whether you actually invest the difference.
How much do you need to buy a $900k house?
A 20% down payment is about $180,000, plus closing costs. Less than 20% down usually adds PMI. Renting frees that cash to invest instead — which is the core of the trade-off.
Does renting really mean throwing money away?
No. Rent buys housing without the costs of ownership (property tax, maintenance, transaction costs), and the down payment can be invested. Buying builds equity but ties up cash and assumes appreciation. Neither is automatically "throwing money away."