Rent vs Buy Calculator
Compare the true cost of renting vs buying over time to see which makes more financial sense for your situation.
Your Details
Renting
Buying
Buying is £164,740 cheaper over 10 years
Buying becomes cheaper than renting at year 1
Renting
- Total rent paid
- £181,122
- Deposit invested (5% pa growth)
- £45,609
- Investment gain on deposit
- £17,609
- Net cost of renting
- £163,513
Buying
- Monthly mortgage payment
- £1,473/mo
- Total mortgage payments
- £176,780
- Total maintenance costs
- £12,000
- Stamp duty
- £0
- Property value at end
- £376,297
- Remaining mortgage balance
- £186,290
- Equity built
- £190,007
- Net cost of buying
- -£1,227
Year-by-Year Comparison
Net cumulative cost at each year (lower is better)
| Year | Rent (net cost) | Buy (net cost) | Difference |
|---|---|---|---|
| 1 | £13,000 | -£22,718 | Buying saves £35,718 |
| 2 | £26,650 | -£17,954 | Buying saves £44,604 |
| 3 | £40,983 | -£13,729 | Buying saves £54,712 |
| 4 | £56,032 | -£10,065 | Buying saves £66,097 |
| 5 | £71,833 | -£6,985 | Buying saves £78,818 |
| 6 | £88,425 | -£4,513 | Buying saves £92,938 |
| 7 | £105,846 | -£2,674 | Buying saves £108,520 |
| 8 | £124,138 | -£1,495 | Buying saves £125,633 |
| 9 | £143,345 | -£1,003 | Buying saves £144,348 |
| 10 | £163,513 | -£1,227 | Buying saves £164,740 |
When Does Buying Make Sense?
Buying a home is not always the right financial decision. Here are the key factors that tip the scales in favour of buying.
You plan to stay 5+ years
The upfront costs of buying (stamp duty, legal fees, surveys) take several years to recoup through equity growth. The longer you stay, the more buying makes sense.
Rent is high relative to mortgage payments
In areas where monthly rent approaches or exceeds mortgage payments, buying lets you build equity instead of paying your landlord's mortgage.
You have a solid deposit
A larger deposit means lower monthly payments, better interest rates, and less interest paid over the life of the mortgage. 10-20% is ideal.
Hidden Costs of Buying
The purchase price is only the beginning. These costs add up quickly and are easy to overlook.
Stamp duty
A tax on property purchases. On a £300,000 home, a first-time buyer pays nothing, but a non-FTB pays £2,500. Above £500,000 the bills get serious.
Maintenance and repairs
Budget 1-2% of your property value per year for maintenance. Boilers break, roofs leak, and kitchens need replacing. As a renter, your landlord covers this.
Buildings insurance
Required by your lender. Typically £150-£400 per year depending on the property. Renters only need contents insurance.
Conveyancing and surveys
Legal fees (£1,000-£2,000) and a property survey (£400-£1,500) are due upfront before you even get the keys.
Hidden Costs of Renting
Renting feels simpler, but it comes with its own long-term financial costs.
No equity built
Every pound of rent goes to your landlord. After 10 years of renting at £1,200/month, you have paid out over £150,000 with nothing to show for it.
Rent increases compound
At 5% annual increases, £1,200/month rent becomes £1,955/month after 10 years. Over 25 years it reaches £4,064/month.
Less stability
Section 21 notices, landlord selling up, or lease renewals with steep increases can force moves. Each move costs £1,000-£3,000 in fees and deposits.
Restrictions on the property
No renovations, restrictions on pets, and landlord approval needed for even minor changes. You are paying a premium for a space you do not control.
What the Numbers Don't Show
A calculator can only measure financial costs. Some of the biggest factors in the rent vs buy decision are personal.
Security and stability
Owning your home means no landlord can ask you to leave. For families, this stability is often worth more than any spreadsheet can show.
Freedom to make it yours
Knock down walls, build an extension, get a dog. Homeownership lets you shape your living space around your life.
Flexibility of renting
If your career or life circumstances are likely to change, renting lets you move quickly without the cost and stress of selling a property.
Frequently Asked Questions
Is it cheaper to buy or rent in the UK?
It depends on your location, deposit size, and how long you plan to stay. In many areas, monthly mortgage payments are similar to rent, but you build equity over time. Our calculator compares the total cost over your chosen period, including equity built, to show which option costs less overall.
How long do I need to stay for buying to make sense?
Typically 3-5 years, due to the upfront costs of buying (stamp duty, legal fees, surveys). If you plan to move sooner, the transaction costs may outweigh the equity you build. Our calculator shows the break-even point for your specific situation.
What costs does the calculator include?
The buying side includes mortgage payments, stamp duty, maintenance costs, and accounts for property value growth and equity built. The renting side includes total rent paid with annual increases, and shows what your deposit would have earned if invested instead.
For illustration only — not financial advice. This calculator uses simplified assumptions. Actual costs vary based on your circumstances, location, and market conditions. Always seek independent financial advice before making property decisions.
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