Buy vs Rent Property Calculator
Compare the true long-term cost of buying versus renting — accounting for mortgage interest, maintenance, opportunity cost of deposit, and property appreciation.
Buy vs Rent Guide
The True Cost of Buying
Buying costs extend far beyond the mortgage payment: stamp duty (2–12% depending on price), solicitor fees (£1,500–3,000), survey fees (£500–1,500), mortgage arrangement fee (£0–2,000), buildings insurance, and ongoing maintenance (typically 1–2% of property value annually for repairs and improvements). The first few years of a repayment mortgage are mostly interest — on a £270,000 mortgage at 4.5%, year one interest alone is approximately £12,000.
The True Cost of Renting
Renting costs include: monthly rent (obviously), but also the opportunity cost of the deposit not invested elsewhere. £30,000 in a stocks and shares ISA returning 7% annually grows to approximately £59,000 over 10 years — this gain is foregone when used as a house deposit. Renters can also invest the difference between rent and mortgage costs (maintenance, insurance, etc.) to build wealth. Renting provides flexibility to move for work or relationships — economically valuable but hard to quantify.
When Buying Wins
Buying typically wins when: you stay in the property long enough to recoup transaction costs (typically 5–7 years minimum), house prices rise above the mortgage interest rate, and you have a large enough deposit to access good mortgage rates. In high-value areas with strong price growth (London, South East), buying has historically created significant wealth over 10+ year periods. The longer you hold, the more buying tends to outperform renting on a purely financial basis.
When Renting Makes More Sense
Renting is often better when: you may move within 3–5 years, the rental yield in your area is very low (properties are expensive relative to rent — common in London), you can invest the deposit at a higher return than house price growth, or you need flexibility for career or lifestyle reasons. In cities where house prices are very high relative to rents (price-to-rent ratios above 25–30), renting and investing the difference can outperform buying on a financial basis.
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