Quick answer
In New Orleans, buying breaks even around year 23. Monthly ownership cost $2,085 vs 2BR rent $1,620/mo. If you plan to stay 23+ years, buy. Less, rent.
Rent vs Buy · LA
Rent vs Buy in New Orleans (2026)
Real math using LA's 0.55% property tax rate, $5,500/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
Buy after year 23
If you stay 23+ years in New Orleans, buying pulls ahead of renting + investing the down payment. Less than 23 years, rent and invest the difference.
Monthly Cost Breakdown
Buying
$2,085/mo
Mortgage P&I
$200,000 loan, 30yr @ 6.8%
$1,304
Property tax
0.55% of assessed (LA avg)
$115
Homeowners insurance
$5,500/yr LA avg
$458
Maintenance
1%/yr of home value
$208
Cash at close: ~$56,250 ($20% down + fees)
Renting
$1,620/mo
2BR rent (median)
New Orleans market rate
$1,620
Renters insurance
~$15/mo typical
$15
Down payment invested
$50,000 growing at 7%/yr
(opportunity cost)
Monthly gap: $465 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 | $289,819 | $-93,785 | $-4,320 | $-89,466 |
| Year 10 | $335,979 | $-152,233 | $-65,147 | $-87,086 |
| Year 15 | $389,492 | $-199,200 | $-132,655 | $-66,545 |
| Year 30 | $606,816 | $-207,499 | $-293,303 | +$85,804 |
Break-even: year 23.That's when accumulated home equity minus ownership costs finally exceeds the renter's invested portfolio.
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 New Orleans?
In New Orleans with a 20% down payment on a median $250K home at 6.8% mortgage rate, buying breaks even around year 23. If you plan to stay less than 23 years, renting wins financially. If you'll stay 23+ years, buying pulls ahead.
What's the monthly cost of owning a home in New Orleans?
On a median $250K home with 20% down at 6.8% fixed rate: mortgage P&I $1,304, property tax $115 (0.55% of assessed value), homeowners insurance $458 (LA average $5,500/year), and maintenance $208 (1% of home value/year). Total: $2,085/month.
How much down payment do I need to buy in New Orleans?
20% down on a median New Orleans home ($250K) is $50,000. Plus closing costs of roughly 2.5% ($6,250). Total cash-to-close: about $56,250. FHA loans allow 3.5% down ($8,750) but require mortgage insurance that adds ~$97/month.
What's the 10-year cost of renting vs buying in New Orleans?
Over 10 years in New Orleans: renters pay $222,858 in cumulative rent but have $157,711 invested (assuming 7% return on the $50,000 down payment + monthly savings). Buyers have paid $297,245 in total ownership costs and hold $165,170 in home equity. Net: renting is ahead by $87,086 at year 10.