Rent vs Buy Calculator
Compare the financial outcome of renting vs buying over a chosen period. Includes house price appreciation, mortgage repayments, and opportunity cost of the deposit.
How Rent vs Buy Calculator works
How this comparison works
Buying net cost = total mortgage payments + deposit − equity at end of period. Renting net cost = total rent paid − opportunity return on deposit (invested at 5%/year in the stock market). Both figures represent money "spent" that you do not get back.
Key variables
The comparison is highly sensitive to: house price growth rate, mortgage rate, comparison period, and the assumed investment return on the deposit. At 0% house price growth, renting often wins over short periods. At historical average growth (3–5%), buying often wins over longer periods.
What this calculator does not include
Stamp duty, conveyancing costs, maintenance (1–2% of property value per year), mortgage arrangement fees, estate agent fees on sale, and rent increases are not included. Buying has significantly higher transaction costs that take time to recover.
The real answer
The rent vs buy question is as much about lifestyle flexibility and financial security as pure numbers. Renting offers mobility; buying offers stability and forced savings. This calculator helps frame the financial side — the right answer depends on your personal circumstances.
Frequently asked questions
Is it better to rent or buy in the UK?
It depends on how long you plan to stay, local house prices, mortgage rates, and your personal finances. Over 10+ years in most UK markets, buying has historically outperformed renting due to capital growth. Over shorter periods or in high-price areas, renting can be financially comparable.
What costs are involved in buying a house?
Stamp duty (0–12% depending on price and buyer type), conveyancing fees (£1,500–2,500), survey costs (£400–1,500), mortgage arrangement fee (£0–2,000), and moving costs. These upfront costs take time to recover through ownership benefits.
How does house price growth affect the comparison?
House price growth is the single biggest variable. At 3% annual growth, a £300,000 property is worth £403,000 after 10 years. This capital gain often tips the balance in favour of buying, even accounting for mortgage interest costs.
What if I can't afford to buy?
Help to Buy equity loans, Shared Ownership, and the Mortgage Guarantee Scheme are government schemes designed to help people buy with smaller deposits. A mortgage broker can advise on the full range of options.
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