Compare the true financial cost of renting against buying over any number of years — including equity, house price growth and opportunity cost on your deposit.
Enter Your Details
Property & Mortgage
£
£
10% of purchase price in this example
%
Renting
£
What you would pay to rent a similar property
Assumptions
%
UK long-run average ~3.5–4%. Use 2–3% for conservative.
%
If you invested your deposit instead of buying. ISA/stocks: 5–7%.
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🏠 Buying — Total Cost
Total mortgage payments—
Upfront costs (SDLT, legal)—
Selling costs (est. 2%)—
Less: equity at end—
Net cost of buying—
🏢 Renting — Total Cost
Total rent paid—
Less: investment gain on deposit—
Net cost of renting—
Future property value—
Remaining mortgage balance—
Equity at end of period (gross)—
Deposit investment value (renting)—
Cheaper option over — years—
Difference—
This calculator uses simplified assumptions and does not account for rent increases, maintenance costs on the property, income tax on investment returns, or changes in mortgage rates. All figures should be treated as indicative. Always take independent financial advice before making a decision of this scale.
How the Calculator Works
The calculator compares the net cost of buying against the net cost of renting over your chosen period.
Net cost of buying = deposit paid + total mortgage payments made + upfront purchase costs (estimated at 3% for SDLT, legal fees and surveys) + selling costs (estimated at 2%) − equity at end of period (future property value minus remaining mortgage balance).
Net cost of renting = total rent paid over the period − the investment gain your deposit would have earned if invested at your chosen rate.
Whichever net cost is lower is the financially cheaper option over that time horizon.
What the Calculator Does Not Include
Rent increases over time (rents typically rise with inflation)
Property maintenance costs (budget 0.5–1% of property value per year for homeowners)
Income tax on investment returns (if using a Stocks and Shares ISA this may be zero)
Changes in mortgage rates (remortgaging costs, fixed-rate expiry etc.)
The intangible benefits of ownership (security, ability to renovate, pets etc.)
It depends on how long you plan to stay, local house prices, mortgage rates and what your deposit could earn elsewhere. Buying typically becomes financially better than renting after 5–10 years in most UK markets because equity accumulates and house prices tend to rise. Short-term buyers often pay more in buying and selling costs (SDLT, legal fees, estate agent fees). There is no universal answer — use this calculator to model your specific situation.
Upfront buying costs include stamp duty land tax (SDLT), solicitor and conveyancing fees (£1,500–£3,000), survey fees (£400–£1,500), and mortgage arrangement fees (£0–£2,000). This calculator estimates upfront costs at 3% of the purchase price as a reasonable average including SDLT. The actual amount depends heavily on the purchase price and whether you qualify for first-time buyer SDLT relief.
The break-even point is when buying becomes cheaper than renting in total. It varies by market and assumptions, but is typically 5–10 years in the UK. High buying and selling costs push the break-even out; strong house price growth and low investment returns on the deposit pull it in. Run different time horizons in this calculator to find your approximate break-even.
UK average house price growth has been approximately 3.5–4.5% per year over the long term (ONS data), though this varies by region and includes periods of decline. For conservative modelling use 2–3%; for central use 3.5–4%; for optimistic use 5–6%. Past performance does not guarantee future results — the right rate depends on the specific location and market conditions.
If renting, your deposit could be invested. Historical UK equity market returns have averaged 6–8% per year before inflation. A Stocks and Shares ISA earning 5–7% annually is a reasonable assumption for a diversified long-term investor. Use 3–4% if the money would stay in cash savings. A higher investment return makes renting look more attractive; a lower rate favours buying.
No. If house prices stagnate or fall, renting while investing the deposit can outperform buying. The key comparison is: does property appreciation plus equity accumulation outperform what your deposit would earn invested elsewhere? In the long run, UK house prices have historically risen, making buying favourable — but this varies significantly by region, timing and individual circumstances.