Should I Buy Now or Rent for One More Year?

When renting is cheaper, when owning wins, and how to decide for your own move

Today’s real estate question is: should I buy now or rent for one more year?

A buyer asked me this. If I have to answer in one sentence, here’s mine: if you plan to stay about seven years or more and the payment fits your budget, buying usually comes out ahead, and if you might move in the next few years, renting one more year is usually cheaper.

That’s the short version. Here’s how I get there.

In the short term, renting is usually cheaper

I ran a simple example. Say you can rent a place for $2,400 a month, or you can buy a $450,000 home. Over five years, with today’s prices and interest rates, you would actually spend less money renting than buying.

But at around the sixth or seventh year, it tips over. By then, something like $200,000 of rent is gone, and you have nothing to show for it. When you own, you have an asset that has historically tended to go up in value over the long run, though there’s no guarantee. If you stay seven years or more, you’ll usually come out ahead by owning.

So it’s not clean-cut. In the short term, renting is better. In the long term, owning is better. That’s why the first question I ask a buyer is how long they plan to live in the home.

Rent keeps going up, a fixed mortgage payment doesn’t

A lot of people say renting is better than buying in 2026. Over the last 20 years or so, rents have grown faster than most people’s paychecks.

A mortgage payment works differently. With a 30-year fixed rate, your principal and interest stay the same for the life of the loan. Property taxes and insurance can still go up, but the biggest part of the payment doesn’t move. If you take inflation into account, that fixed payment actually gets smaller over time.

There are a few exceptions, like Los Angeles or New York City, where buying may not make much sense and renting might be the only option. For most of the rest of the country, buying is better long term.

A house is something you live in

I recently saw a well-known money personality on X with about a million followers make a point about his mom’s house. His parents bought it in 1962. On paper, it looks like they made a lot of money. But he compared it to gold, and said the house cost more ounces of gold in 1962 than the same house is worth in gold today, so his mom actually lost money once you adjust for inflation.

The key point he’s missing is that a house is something you use. You live in it. If his mom had bought gold instead of the house, she still would have needed a place to live. By my rough estimate, the rent over all those years would have been somewhere between $600,000 and $1 million. So his mom did fine buying a house. You can’t live inside a few-inch block of gold.

When you compare buying with renting, or with any other investment, don’t forget the cost of having a roof over your head.

What I’d look at before deciding

If you’re trying to decide between buying now and renting one more year in Bethany, 97229, Cedar Mill, or Beaverton, these are the things I’d look at:

• How long you plan to stay. Under about five years, renting usually costs less. Seven years or more, owning usually wins.
• Whether the full monthly payment, including taxes and insurance, fits your budget without stretching.
• How much you’d have left after the down payment and closing costs, so you’re not starting with an empty savings account.
• What a similar home rents for nearby, compared with what it would cost to own.

A local lender can show you the real payment numbers for your situation. I go deeper into why many online rent vs. own calculators get this wrong in why rent vs. buy calculators are often misleading.

Summary

If you might move in the next few years, renting one more year is usually cheaper. If you plan to stay seven years or more and the payment fits your budget, buying usually comes out ahead, because rent keeps rising while a fixed mortgage payment stays the same, and you end up owning an asset instead of paying for someone else’s. Don’t compare a house to gold or stocks without counting what you’d pay to live somewhere.

This is general information from my experience, not financial or lending advice. Talk with a local lender about your own numbers.

If you’re thinking about buying in Bethany, 97229, Cedar Mill, or Beaverton, schedule a call here, search homes for sale, or call or text Shawn Yu at 503-515-4499.

Thanks for reading. Have a great day.

Shawn Yu, Shawn Realty
shawn-realty.com