Put in the price of the house you are looking at and what you pay in rent now. Every box can be changed.
A $1,350,000 house against $4,500 a month in rent, over 20 years
Your numbers
If you buy
What that month is made of
Where you end up
If you rent
What that month is made of
Where you end up
It was your landlord's house the whole time.
What every number here means
House price. What the home costs.
Rent. What you pay a landlord now. It follows the price until you type your own figure over it, then it stays put. It rises 4% a year from there.
Down payment. Cash up front. Under 20% adds mortgage insurance and a slightly higher rate, and the page applies both.
Mortgage rate. The Freddie Mac national average on 10 September 2026. Only a lender can quote you yours.
House goes up, % a year. Averaged over the years you stay, not repeated every year. A setting, not a prediction.
Years you stay. Starts at 20, which is how long a typical Los Angeles owner keeps a house, the longest tenure in the country. Proposition 13 is a large part of why. Under about five years, buying rarely wins.
Tax bracket. Your federal rate, used for the mortgage interest deduction. Set it to 0 to leave it out.
Why the break-even rate is the number that matters
At today's rates, owning costs more per month than renting the same home. That gap is real and it is the reason buying can lose. What closes it is the house gaining value. So there is one rate at which the two sides land in exactly the same place, and the page solves for it every time you change an input.
Below that rate, renting wins and the page says so. Above it, buying wins. That turns an argument into something you can check, because every South Bay city has ten years of record behind it.
| City | 2016 | 2026 | Average per year |
|---|
Every one of those twelve markets averaged between 3.4% and 6.3% a year across the decade. A typical South Bay house at today's rates needs somewhere around 2% to 3.5% a year to make buying the better outcome, which is below the slowest market on that list. Hermosa Beach is the closest to the line and it is also the least reliable figure here: it sells about ninety houses a year, so its starting median swings on which houses happened to close. Move its base year by one and its rate runs anywhere from 3.4% to 5.2%.
Three things to know
Past prices are not a promise, and prices really do fall. Los Angeles lost about 44% from the 2007 peak to the 2011 bottom, and the Southern California median did not get back to its old high until late 2017. That is roughly ten years. Anyone who tells you housing only goes up is selling you something.
That is the argument for staying put rather than the argument against buying. Every one of the twelve South Bay cities in the table above is worth more now than in 2016, the 2023 dip here ran only 3% to 12%, and most of these markets have since made new highs. The years you plan to stay is the most important box on this page, and ten is not a conservative answer by accident.
The sale data here runs through March 2026, and the market was cooling over the summer.
The starting rent is an estimate of what a house at this price rents for in the South Bay. Rents vary street to street, so put in what you actually pay. It changes the answer more than almost anything else on the page.
A median is not your house. Use this for the shape of the decision, then call me for your actual numbers.
Want this run on a real address?
Send me the home you are looking at and what you pay in rent now. I will put your real numbers through it, including the tax treatment this page leaves out, and tell you honestly if the timing is wrong.
New to this? Start with the First-Time Home Buyer Guide.
Important disclosures
I am a real estate agent, not a financial advisor. Gabi Bottura is a licensed California real estate salesperson, CA DRE #02246390, with Beach City Brokers, CA DRE #01311124. I am not a certified financial planner, an investment adviser, a tax professional, an attorney, or a mortgage lender, and nothing on this page is advice from any of those. It is general education about how the arithmetic works.
The tax figure counts one deduction, not two. Mortgage interest is counted, at the bracket you enter, and only on the first $750,000 you borrow, which is the limit for a home bought after 2017. The property tax deduction is not counted at all, because state and local taxes are capped at $40,000 a year and a household buying at this price in California is often past that on state income tax alone. If your CPA finds you have room, the real answer is better for buying than what this page shows.
This is not tax advice. The deduction figure is an estimate. It assumes you itemize, and it does not know your filing status, your other income, the standard deduction, the alternative minimum tax, or your state return. Your actual benefit may be smaller, or nothing at all. Confirm it with a CPA or tax attorney before you rely on it.
This is not a loan estimate or an offer of credit. The 6.76% starting rate is a published national average from the Freddie Mac Primary Mortgage Market Survey dated 10 September 2026, not a quote. Your rate, fees, and whether you qualify at all are decided by a lender, not by this page or by me.
This is not an appraisal, a valuation, or a market analysis of any specific property. The figures are medians across a whole city. No individual home is worth its city's median.
Past performance does not predict future results. Appreciation figures are historical. Home prices can and do fall. The sale data here runs through March 2026 and the market was cooling after that. Nothing here is a forecast, a guarantee, or a promise of any return.
What is not assumed. Owning costs more per month than renting, and this page does not assume you invest that difference. Someone who reliably invested it every month would see a different comparison. Ask a financial professional if that describes you.
Estimates only. Every output is an estimate produced from the assumptions listed above. It assumes you still live there at the end, so nothing is taken off for selling; if you would sell, take about 5% off the house value. This page does not take into consideration maintenance and repairs, nor costs that vary between properties, such as closing costs, HOA dues, Mello-Roos and other special assessments, utilities, and any rental insurance or deposit a tenant pays. Your real costs will include them. No warranty is made as to accuracy or completeness.
Equal Housing Opportunity. I comply with the federal Fair Housing Act and the California Fair Employment and Housing Act. The city comparisons here are about price history alone and are not a recommendation about where any person should or should not live. Every buyer is welcome in every neighborhood.
Sources. The 2007 to 2011 Los Angeles decline and the late 2017 recovery of the Southern California median to its bubble era high are as reported from S&P Case-Shiller and California Association of Realtors data. Sale prices: Redfin Data Center city and ZIP market tracker, median sale price of single family homes, not seasonally adjusted, April 2016 through March 2026. Rents: the starting figure is an estimate of the market rent for a single family house at this price in the South Bay, based on local experience rather than a published index; published asking rents across all rental property types run materially lower because they are mostly apartments and condos. Mortgage rate: Freddie Mac Primary Mortgage Market Survey, 10 September 2026. Homeowner tenure: Redfin, which puts the Los Angeles median at 20 years against a national 12. Tax rules: the $750,000 acquisition debt limit and the $40,000 state and local tax cap as they stand for the 2026 tax year. Mortgage insurance rates are mid range 2026 figures by loan to value for a strong credit score, cancelled at 78% loan to value as federal law requires; a weaker score costs several times more. For reference, the 2026 conforming loan limit in Los Angeles County is $1,249,125, and borrowing above it is a jumbo loan priced on its own terms.