If high housing prices are keeping you from buying a home, consider that Millennials spend almost $100,000 on rent by the time they’re 30.

Could that money be better spent elsewhere, such as building equity in a home? When is homeownership worthwhile?

The rule of thumb on housing costs is that it shouldn’t be more than 30 percent of income. But Millennials spend 45 percent of their income on rent between ages 22-30, and Generation X spends 41 percent, according to an analysis of U.S. Census data by RENTCafe. The younger you are now, the more money you should expect to pay in rent by age 30, it found.

Younger Millennials, now between 22 and 29 years old, are paying a median rent of $97,400 before turning 30, which equates to 47 percent of their income, RENTCafe found. Older Millennials, now 30-40 years old, pay about $7,000 less, equaling 40 percent of their income in rent.

And it’s only projected to get worse for younger people. Generation Z, now aged around 20, will pay $102,100 on rent by the time they hit 30, the analysis found.

Benefits of renting

Beyond the high amount spent on rent during those final eight years in your 20s, there are many factors that go into deciding if you should move from being a renter to a buyer and having a home loan. The benefits of renting can weigh heavily for years, giving renters with monthly leases the ability to move freely to change jobs.

Being a renter is usually a pretty carefree life. Other than renter’s insurance to cover their belongings, they don’t have other expenses such as homeowner's insurance, property taxes, home maintenance, or a mortgage, which can be higher than rent. If the air conditioner breaks in your apartment, the landlord will fix it. Some rental properties include utilities in the monthly rent, providing more savings. Rent can also be cheaper than buying in urban areas.

“People love to tell you that owning is always a better investment than renting and while they are technically correct, they fail to factor in the reality that in many major cities property values are at record highs and the Millennial market needs to find jobs in these cities to pay off their extraordinary outstanding student loan amounts,” says Chris Taylor, managing director at Advantage Real Estate in Boston. “Sometimes they don’t have a choice other than renting.”

Time isn’t on a renter’s side

The longer you’re a renter, the more money you’ll likely spend on housing than you would as a homeowner.

The tech-savvy Gen Zers are starting to look for their first apartments, and are likely to demand apartments and homes with more technological updates that are likely to drive monthly rents higher, according to RENTCafe.

To make homeownership worthwhile, you should live there for five years, according to real estate experts we talked to. Some dropped that to two years. Less than that, and the advantage goes to renting.

“It doesn’t make sense to buy unless you have a window period of at least five years,” says Casey Fleming, a mortgage advisor at C2 Financial Corp. in San Jose, Calif.

At least 10 percent appreciation in the home is needed to break even and cover costs such as closing, maintenance, repairs and the commission for a real estate agent, Fleming says. Over time, a home should average 3 percent appreciation annually, he says.

If you have to leave a home within five years of buying it, then rent it out, he recommends.

It can take five years or more to recoup your purchasing costs, when it will be a good time to reevaluate your situation and consider moving if necessary, says McCall Robison, chief editor of the BestCompany.com home warranty blog.

Pay what you can afford

Paying 45 percent of your income toward rent, as many Millennials are doing, is much more than the recommended 30 percent. Reaching that mark is important for homebuyers too, and may be required by a lender before it approves a mortgage loan.

A simple calculation to make to see if you can afford a home is multiplying your current salary by 2.5, Robison says. If a home costs more than that, renting may be more worth it.

“A lot of people turn to buying a house because they feel they no longer want to empty their pockets into a never-ending black hole of rent,” she says. “However, as true as this can be, it is still not the better choice to buy a house if you cannot afford the long-term investment. Ultimately, that will only dig you farther into a moneyless pit.”

The 2.5 salary multiplier should include the costs of homeownership. These include utilities, taxes, mortgage, maintenance and other costs.

Getting married to someone with a job can double the salary available to buy a home. That’s the case in most homes, where 66 percent of buyers are married couples, according to the National Association of Realtors.

“Don’t rush it,” Robison says of doing the calculation. “Take time to crunch the numbers and figure out if becoming a homeowner is really worth it for you at this point in time. Although you may feel antsy, rushing such a big decision will only prove detrimental in the long run.”

Buying a home is an investment that should at least pay off in retirement by not having a mortgage, Fleming says, and should save most buyers money in the short-term too.

“Within a few years, your monthly payment will be cheaper than it was renting,” he says.

Building equity

One of the main benefits of buying a home is that you build equity in it as you make monthly mortgage payments. Renters get zero equity.

To build home equity quicker, buyers who find a good deal on a distressed house or one that needs a little work can create 10-20 percent equity, says

Mark Ferguson, a real estate broker in Greeley, Colo., who owns the real estate investment site investfourmore.com.

“Buying is a forced savings plan,” says Ferguson, who considers two years long enough to make buying more affordable than renting. “Most Americans do not save money. That is why the vast majority of people create their net worth from their homes.”

After two years of living in a home you’re buying, the profit is tax-free if you want to sell it, he says. You don’t have to buy another house or do a 1031 exchange, which is for investment properties where the owner doesn’t live in them.

Along with equity, first-time buyers should look at the home they’re buying as their first home that they’ll probably move out of. It can be turned into an investment rental and shouldn’t be considered their permanent home, says Allen Johnson, a real estate agent at Keller Williams in Washington, D.C.

“Millennials should be looking to leverage a home with very little money down,” Johnson says. “That’s the beauty and the opportunity of real estate.”

Compare costs

Along with the costs of buying, insuring and maintaining a home, consider which are fixed and which are variable, says Alex Hubler, owner of Alex Hubler Homes in Wayzata, Minn.

“Your rent is relatively stable with rate increases only coming at the end of lease terms,” Hubler says. “However with a home there are both fixed and variable costs to consider.”

A 15- or 30-year fixed-rate mortgage will be locked in for the life of the loan, insurance costs are generally pretty stable, taxes can fluctuate around 1-2 percent annually, and there may be some special assessments from your municipality for new roads, sewers, sidewalks and other things, he says. A home inspection should help forecast upcoming maintenance.

“When I work with a Millennial home buyer that currently rents with a roommate I often suggest they consider asking the roommate if they would like to continue living together when they purchase their home,” Hubler says. “It’s an easy way to subsidize living costs and the roommate will likely be looking for a place to live anyways.”