Rent vs buy calculator
Both paths side by side over a period you choose. Every growth rate is one you enter, because nobody can honestly tell you what house prices will do.
How this is calculated
Both paths are simulated month by month over the period, and compared on net position at the end rather than on monthly cost.
The buyer pays the deposit and buying costs up front, then a mortgage payment plus maintenance and insurance. Their wealth at the end is the property value less the outstanding mortgage and selling costs.
The renter invests the deposit and buying costs from day one, then invests whatever the monthly difference is whenever renting is cheaper. If buying is cheaper in a given month, the buyer invests the difference instead. Both sides get the same treatment.
The answer is extremely sensitive to three numbers: house price growth, rent rises and investment return. Change any of them by a point or two and the verdict can reverse, which is why this calculator asks you for all three rather than choosing them for you.
Rates used · 2026/27
| Everything forward-looking | entered by you, not assumed by us |
| Typical selling costs | 1.5% to 2.5% including agent and legal |
| Not included | tax on investment gains, moving costs while renting |
| Rule of thumb | under five years, buying rarely recovers its costs |
Last checked July 2026. Source: HMRC and gov.uk.
Worked example
On a £250,000 house with a £25,000 deposit at 4.5%, against £1,100 rent, with house prices growing 3%, rent rising 3% and investments returning 5%: after ten years the buyer is worth £152,764 and the renter £60,558, so buying is ahead by £92,206. Drop house growth to 1% and the gap narrows sharply, which is the whole point of entering your own rates.
Common questions
Which is better, renting or buying?
There is no universal answer, and anyone giving you one is guessing. It turns entirely on the growth rates, how long you stay, and what a renter actually does with the money they are not putting into a deposit.
Why does the renter invest the deposit?
Because otherwise the comparison is unfair. The buyer has tied up a large sum, and the honest comparison assumes the renter puts the same sum to work rather than spending it.
What growth rate should I use for house prices?
Whatever you genuinely believe, and then try it again two points lower. Long-run UK house price growth has often been close to wage growth, but any decade can look nothing like the long run.
Does this include tax on investments?
No. Gains inside an ISA are tax free but outside one they may not be, which would move the answer towards buying.