Choosing whether to rent or buy a home in the UK is a big money choice. This tool helps you compare the total wealth built over time between two paths:
- Buying a Home: You pay a deposit, purchase costs (Stamp Duty), and monthly mortgage payments. You build equity as the home's value rises and you pay down the loan.
- Renting & Investing: You rent a similar home and invest the extra cash (money saved by not buying) into a spread-out portfolio (like stocks or ISAs).
Key Considerations for UK Buyers
- Stamp Duty Land Tax (SDLT): This upfront tax can be high. First-time buyers often get relief.
- Upkeep: Owners must pay for all repairs (boiler, roof, etc.). Budget about 1% of home value each year.
- Investment Returns: Over time, the stock market (FTSE/Global) has returned 5-7% per year after inflation. UK property has grown at varied rates.
Leasehold vs Freehold
When buying a flat in the UK, you must know the tenure type. Our guide on leasehold vs freehold explains the key differences and costs like ground rent and service charges.
If you want to buy a rental property, see our Buy-to-Let mortgage guide for current rates and rules. Also, know your duties around landlord compliance if you plan to rent out your home.
Use this tool to model your specific scenario. You can also use our repayment calculator to check monthly costs.