Rent vs Buy Calculator
Compare the total cost of buying (with a mortgage) and renting over your chosen period, accounting for deposit, interest, upkeep and property appreciation.
Compare mortgage deals
"Net cost of buying" = deposit + payments + upkeep − equity built. Simplified estimate; excludes stamp duty and transaction costs.
How the rent vs buy calculator works
Enter the property price, deposit, mortgage rate and term, monthly rent, comparison period, expected upkeep costs and annual appreciation.
The calculator computes the mortgage monthly payment and then over the chosen period: total mortgage payments paid + deposit + upkeep costs, minus the equity you've built (appreciation + principal repaid). This "net cost of buying" is compared against total rent paid over the same period.
Key definitions
- Deposit — upfront cash cost of buying
- Upkeep % — annual maintenance as % of property value (typically 1–2%)
- Appreciation — expected annual property price growth
- Net cost of buying — real cost after subtracting equity built
Frequently asked questions
What does 'net cost of buying' mean?
Deposit + all payments + upkeep − equity built (appreciation + principal repaid). This is the true cost after accounting for wealth accumulated.
Is it always better to buy?
Not always — it depends on your deposit, local property growth, how long you stay and mortgage rate. In high-price cities with slow appreciation, renting can come out ahead.
What is excluded from the calculation?
Stamp duty, solicitor fees, survey costs (can add 2–5%) are not included. Factor these in separately.
Is my data sent anywhere?
No — the calculation runs locally in your browser.
Rent or buy: how to compare them honestly
“Rent is money down the drain” is the most expensive oversimplification in personal finance. A fair comparison sets all the costs of owning against renting over the same period — and that is what the calculator above does. Owning is not the mortgage payment; it is mortgage interest + maintenance + insurance + buying/selling costs − the equity you build and the appreciation you may enjoy. Renting is the rent — plus the return you could earn by investing the deposit you did not spend.
Worked example
Take a £250,000 property with a £25,000 deposit on a 25-year mortgage at 4.5%: the payment is about £1,251 a month. Compare against renting a similar home for £1,100. Over five years the renter pays £66,000; the owner pays about £75,000 in mortgage payments plus, say, £2,500 a year upkeep — roughly £87,500 out of pocket. But the owner has also repaid a chunk of principal and owns any price growth on the whole £250,000 (leverage works both ways). Whether buying wins depends mostly on appreciation, your time horizon, and how long you stay — which is exactly why the calculator lets you vary all three.
What tips the scales
- Time horizon is the big one. Buying has heavy fixed costs (survey, legal fees, stamp duty where it applies, and estate-agent fees when selling). Staying under ~5 years usually favours renting; over 10 usually favours buying.
- Interest rate vs rent growth. High mortgage rates with flat rents favour renting; low rates with rising rents favour buying.
- Maintenance is not optional. Budget roughly 1% of the property value per year long-term; leaseholds add service charges and ground rent.
- The deposit has an opportunity cost. £25,000 invested at 5% earns £1,250 a year — the calculator counts this for the renting side.
- Flexibility has value too. Renting lets you follow jobs and change life plans cheaply; ownership insures you against rent rises and eviction. Neither appears on a spreadsheet.
Additional questions
Is buying always better in the long run?
Usually, but not axiomatically. Long stays amortise the transaction costs and fix your housing cost while rents inflate — but a leveraged purchase into falling prices, or a forced early sale, can lose heavily. The honest answer is “run the numbers with your own horizon”, which is what this page is for.
Why compare on cash spent rather than the full mortgage payment?
Part of each mortgage payment buys equity — it moves money from your bank account into your house, but it is not lost like interest or rent. Comparing only true costs (interest, fees, upkeep vs rent) is what makes the comparison fair.
What appreciation rate should I assume?
UK house prices have grown at very different rates by decade and region; 2–3% nominal is a moderate long-run assumption, and it is worth testing 0% to see whether your decision survives a flat market. If it only works at 5%+ growth, you are speculating, not budgeting.