Rent vs. Buy Calculator — By State (2026)

No. The comparison uses pre-tax cash flows for both sides. Whether the deduction is worth anything depends on whether your itemized deductions beat the standard deduction, which for 2026 is $16,100 for a single filer, $24,150 for a head of household and $32,200 for a joint return (IRS Revenue Procedure 2025-32). Only the part of your itemized deductions above that lowers your tax, and only at your tax rate.

Example with this calculator's starting inputs ($450,000 home, 20% down, 6.5% rate, 30-year loan, CA property tax): the first year's interest is about $23,282 and property tax about $3,465, together $26,747 before any state income tax. That is above a single filer's standard deduction, so itemizing could save some tax, but below a joint filer's, so a married couple with no other deductions would gain nothing from owning on this line. The deduction is allowed on interest on up to $750,000 of loans taken out after 2017 (26 U.S.C. § 163(h)(3)(F)), and state and local taxes, property tax included, are deductible up to $40,400 in 2026, reduced for incomes above $505,000 and falling to $10,000 again from 2030 (§ 164(b)(7)). If you will itemize, buying is somewhat better than the calculator shows; if you will not, the calculator is right. To see which side of the line you are on, with the 2026 SALT cap, mortgage interest limits and charity floor, use the standard vs. itemized deduction calculator.

The property tax rate and insurance amount start at state averages from the sources listed below, which are secondary compilations. Your own bill depends on the home's assessed value and your county's rates, so replace them with the figures for the home you are looking at (the county assessor publishes the rates, and the listing or an insurance quote gives the premium). The other starting values, 3.5% yearly home price growth, 3% rent growth, a 6% investment return, 2.5% closing costs, 6% selling costs and 1% yearly maintenance, are assumptions, not forecasts; change them and watch the result move, because the answer is more sensitive to them than to the exact tax figure. The model also leaves out private mortgage insurance (which applies when you put down less than 20%; see the PMI guide), tax on the renter's investment gains, and moving costs.