How the rent vs buy calculator works
Comparing a mortgage payment with a rent payment is misleading, because part of every mortgage payment builds up your own wealth, while buying also brings big costs that renters never pay. This calculator compares the net cost of each option over the number of years you choose, meaning everything you pay out minus anything you are left with at the end.
Net cost of renting = total rent − growth on the deposit and buying costs, invested instead
Whichever is lower is the cheaper option. The year-by-year table shows when buying pulls ahead. Early on renting usually wins, because stamp duty and fees are a dead cost that takes years to recover.
Stamp duty used in the calculator
The calculator uses the Stamp Duty Land Tax rates for England and Northern Ireland that have applied since 1 April 2025 and remain in place for 2026/27. Home movers pay 0% up to £125,000, 2% to £250,000, 5% to £925,000, 10% to £1.5 million and 12% above. First-time buyers pay nothing up to £300,000 and 5% on the part from £300,001 to £500,000, but lose the relief completely above £500,000. For other buyers or for Scotland and Wales, see the stamp duty calculator and enter the figure under other buying costs.
Worked example: £300,000 home vs £1,200 a month rent over 10 years
You have a £60,000 deposit and take a £240,000 mortgage at 4.5% over 25 years, costing £1,334.00 a month. House prices and rents both rise 3% a year, maintenance is 1% of the value a year, and your money would otherwise earn 5%.
- Upfront: £60,000 deposit + £5,000 stamp duty + £3,000 fees = £68,000
- Mortgage payments over 10 years: £160,080
- Maintenance: £34,392
- After 10 years the home is worth £403,175. Take off the £174,380 still owed and £6,048 selling costs and your equity is £222,747
- Net cost of buying: £39,724
- Rent over 10 years: £165,080. The £68,000 invested at 5% grows by £42,765
- Net cost of renting: £122,315
Buying comes out £82,591 cheaper over 10 years, and pulls ahead in year 2. As a first-time buyer there is no stamp duty at this price, so buying is cheaper still. If house prices stay flat and rents don't rise, the result flips: over five years with no growth, buying costs £78,399 against £72,000 for renting.
What makes the biggest difference
| Factor | Favours buying when | Favours renting when |
|---|---|---|
| Time you stay | You stay five years or more | You may move within two or three years |
| House price growth | Prices rise steadily | Prices are flat or falling |
| Mortgage rate | Rates are low | Rates are high compared with rents |
| Investment return | Savings earn little | Your invested deposit grows strongly |
| Rent level | Rents are high for the area | Rents are cheap compared with prices |
Things the numbers don't show
- Owning gives you security and the freedom to decorate or extend, but repairs, such as a new boiler or roof, are your bill.
- Renting lets you move easily for work, but rents can rise and a landlord may decide to sell.
- Your mortgage rate will change when any fixed deal ends. Try a higher rate to see how sensitive the result is.
Before buying, check what you could borrow with the mortgage affordability calculator and your monthly payment with the mortgage calculator.
Frequently asked questions
Is it cheaper to rent or buy in the UK?
Over the long term buying is usually cheaper if house prices rise, because you build equity. Over short periods renting often wins, since stamp duty, fees and selling costs take several years to recover.
How long do you need to stay for buying to be worth it?
It depends on prices, rates and rent, but with 3% house price growth a home mover buying at £300,000 with a 20% deposit is ahead of renting at £1,200 a month by year 2. With no price growth, buying can take much longer to pull ahead.
How much stamp duty will I pay on a £300,000 home?
A home mover in England or Northern Ireland pays £5,000. A first-time buyer pays nothing, because first-time buyer relief covers the first £300,000.
Should I include maintenance in the cost of buying?
Yes. A common rule of thumb is to budget around 1% of the home's value a year for repairs and upkeep, which is £3,000 on a £300,000 home. You can change this in the calculator.
Why does the calculator include investment returns?
If you rent, your deposit and buying costs stay in your pocket and can grow. Ignoring this makes buying look better than it is, so the calculator counts the growth you'd miss.
Last reviewed October 2026 using 2026/27 figures. This calculator gives an estimate for guidance only.