Quick answer
At current rates, renting wins over the full 30-year horizon in Madison. Monthly ownership cost $2,885 (vs $$1,720/mo rent) plus WI's 1.76% property tax make the math tough.
Rent vs Buy · WI
Rent vs Buy in Madison (2026)
Real math using WI's 1.76% property tax rate, $1,250/year average insurance, and a 6.8% 30-year fixed mortgage. Accounts for opportunity cost — what the down payment would earn invested at 7%.
Last updated: April 23, 2026
Verdict at current rates
Renting wins (30-year horizon)
In Madison at WI's tax rates and current 6.8% mortgages, keeping the down payment invested at 7% beats homeownership even after 30 years. The standard advice "buy to build equity" doesn't apply here at today's price-to-rent ratio.
Monthly Cost Breakdown
Buying
$2,885/mo
Mortgage P&I
$296,000 loan, 30yr @ 6.8%
$1,930
Property tax
1.76% of assessed (WI avg)
$543
Homeowners insurance
$1,250/yr WI avg
$104
Maintenance
1%/yr of home value
$308
Cash at close: ~$83,250 ($20% down + fees)
Renting
$1,720/mo
2BR rent (median)
Madison market rate
$1,720
Renters insurance
~$15/mo typical
$15
Down payment invested
$74,000 growing at 7%/yr
(opportunity cost)
Monthly gap: $1,165 cheaper than buying. Renter invests that difference.
Year-by-Year Net Position
"Buy wins by" = what you'd clear selling the home minus what the renter has in investments. Positive = buy ahead.
| Year | Home value | Buyer equity (net) | Renter portfolio (net) | Buy wins by |
|---|---|---|---|---|
| Year 5 | $428,931 | $-125,991 | +$71,555 | $-197,546 |
| Year 10 | $497,249 | $-197,642 | +$85,892 | $-283,535 |
| Year 15 | $576,448 | $-249,937 | +$126,600 | $-376,537 |
| Year 30 | $898,087 | $-192,299 | +$579,024 | $-771,323 |
Assumptions
Every rent-vs-buy calculator depends on the assumptions. Here are ours — all transparent, none cherry-picked to bias the answer.
This is a rule-of-thumb calculator. Real decisions involve your specific tax bracket, any HOA, mortgage points, closing-cost negotiations, and exact loan terms.
Frequently Asked Questions
Is it better to rent or buy in Madison?
In Madison at current mortgage rates (6.8%), renting and investing the down payment beats buying for the full 30-year horizon. Median monthly ownership costs ($2,885) well exceed median 2BR rent ($1,720), and WI's 1.76% property tax makes the math especially tough.
What's the monthly cost of owning a home in Madison?
On a median $370K home with 20% down at 6.8% fixed rate: mortgage P&I $1,930, property tax $543 (1.76% of assessed value), homeowners insurance $104 (WI average $1,250/year), and maintenance $308 (1% of home value/year). Total: $2,885/month.
How much down payment do I need to buy in Madison?
20% down on a median Madison home ($370K) is $74,000. Plus closing costs of roughly 2.5% ($9,250). Total cash-to-close: about $83,250. FHA loans allow 3.5% down ($12,950) but require mortgage insurance that adds ~$144/month.
What's the 10-year cost of renting vs buying in Madison?
Over 10 years in Madison: renters pay $236,614 in cumulative rent but have $322,507 invested (assuming 7% return on the $74,000 down payment + monthly savings). Buyers have paid $412,260 in total ownership costs and hold $244,452 in home equity. Net: renting is ahead by $283,535 at year 10.