A fair comparison,month by month.
The calculator asks one narrow question: under the assumptions you choose, which housing path leaves you with more net wealth after the same time and the same available cash?
01 / FAIR START
Neither path gets extra money.
Many rent-versus-buy calculators compare a mortgage payment with rent and stop there. That quietly ignores the deposit and the monthly savings available to whichever path costs less. We neutralise both advantages.
Same money on day one
Both paths receive the larger of the buyer’s and renter’s upfront cash requirements. The buyer pays the deposit, SDLT and purchase costs; the renter locks away their rental deposit, pays any entered renter upfront costs and invests the remainder. The rental deposit earns no return and is returned at its nominal value at exit.
Same commitment each month
The common monthly budget is the higher of the two paths’ housing outgoings that month. The cheaper path invests the difference. If rent or ownership costs later cross over, the investment advantage changes direction too.
02 / MONTHLY MODEL
What moves through the model
The calculation advances one month at a time for the selected stay. It keeps cash flow, wealth and unrecoverable cost separate; paying money out is not always the same as losing wealth.
(1 + annual rate)^(1/12) − 1. Rent growth steps at each twelve-month tenancy anniversary; mortgage interest uses the entered nominal annual rate ÷ 12. Percentage assumptions are normalised to two decimal places before entering the model.Complete input register
How every calculator field enters the ledger
The calculator has 21 financial-model inputs. Future inflation and the nominal/today’s-money selector are two display settings; they do not change the underlying nominal result. “Restore example” loads illustrative working values, not a current market quote, forecast or recommendation. A growth assumption is treated as manual unless you explicitly attach evidence with a chooser.
- Property, rent and stay
- Property price is the home’s value at month zero. Comparable monthly rent is the renter’s month-one rent. The selected stay is converted to the nearest whole month and sets the projection and assumed sale date.
- SDLT treatment
- First-time buyer, home mover and additional-property modes apply the date-labelled England and Northern Ireland bands to the property price. Tax is calculated marginally, then the final amount is rounded down to the nearest whole pound. “Do not include” sets SDLT to zero as a manual override.
- Deposit and initial mortgage
- Buyer deposit = property price × deposit percentage. Initial mortgage principal = property price − buyer deposit. A 100% deposit therefore produces no mortgage payment.
- Mortgage rate and term
- The entered nominal annual mortgage interest rate is held constant for the whole repayment term. Enter the product interest rate, not APRC. The term is converted to the nearest whole month. Eligibility, product fees, rate changes and remortgaging are not modelled.
- Growth and investment return
- Property growth compounds the current property value monthly. Investment return compounds both paths’ existing market investments monthly. Both are nominal annual assumptions converted to effective monthly rates.
- Rent growth
- Rent remains at the entered monthly amount for months 1–12, then compounds by the annual rent-growth assumption at each twelve-month tenancy anniversary.
- Buying and selling costs
- Purchase costs = fixed buying costs + property price × additional buying-cost percentage. Selling costs = property value at the comparison date × selling-cost percentage.
- Ownership running costs
- Maintenance = current property value × annual maintenance percentage ÷ 12. Home insurance, service charge and ground rent are the entered monthly amounts and remain fixed in nominal pounds.
- Rental deposit and upfront costs
- Rental deposit = initial comparable monthly rent × entered deposit months. It stays fixed, earns no return and is returned in full at exit. Entered renter upfront costs are paid at month zero and are unrecoverable.
- Renter running costs
- Renter insurance and other renter costs are added to rent each month. They remain fixed in nominal pounds; only rent changes with the rent-growth assumption.
Mortgage and starting-capital formulas
With mortgage principal P, monthly rate r = (nominal annual rate percentage ÷ 100) ÷ 12and term n months, the scheduled repayment is P × r ÷ (1 − (1 + r)^−n). At 0% interest it is P ÷ n. Each month, interest is opening balance × r; the rest of the payment is principal. The final payment is capped at the remaining balance plus interest, and payments stop when the loan is cleared.
Buyer upfront cash is buyer deposit + SDLT + purchase costs. Renter upfront cash is rental deposit + renter upfront costs. Starting capital is the larger of those totals. Each path invests starting capital minus its own upfront cash, so neither receives extra money on day one.
Normalisation and supported ranges
Browser-storage and URL values are parsed through the same rules as edited fields. Invalid numeric values fall back to that field’s example value; finite values outside a supported range are clamped. An unsupported SDLT treatment falls back to home mover, and an unsupported display basis falls back to nominal. Percentage inputs are rounded to two decimal places before calculation.
The browser continuously keeps one working draft. The New control resets that draft to the example values. Save creates a named local scenario or explicitly updates the scenario currently loaded, while Load replaces the working draft with a saved scenario. Each named scenario contains the complete normalised input, evidence and display state. New share links encode their state after #scenario=, in the browser-only URL fragment. Explicit values there take priority on arrival. Older query-string links remain supported and are rewritten to the fragment format after the browser loads them. Local scenario names are not placed in the URL and do not enter the calculation.
- Property price: £0–£5m; monthly rent: £0–£50,000; stay: 1–50 years; mortgage term: 1–50 years.
- Buyer deposit: 0%–100%; nominal annual mortgage interest rate: 0%–25%; rental deposit: 0–12 months.
- Property growth, rent growth and investment return: −99%–50% a year; future inflation display rate: −10%–50% a year.
- Additional buying, selling and maintenance percentages: 0%–25%. Fixed buying and renter upfront costs: £0–£500,000.
- Home insurance, ground rent and renter insurance: £0–£10,000 a month; service charge and other renter costs: £0–£25,000 a month.
While a number field is being edited, incomplete drafts such as a leading minus or an empty value stay local to that field. A complete base-10 decimal value updates the calculation; hexadecimal, exponent and whitespace-padded forms are not accepted. Blur or Enter applies the existing normalisation and restores the last valid value when the draft is incomplete or invalid. A complete value outside the displayed supported range is marked as not applied; the result stays on the last valid value until the draft returns to range.
How UK HPI evidence becomes an input
When you use the property-evidence chooser, the tool compares the standardised average price for the selected area and property type at the beginning and end of a 5, 10, 15 or 20-year period. The nominal annualised rate is (end price ÷ start price)^(12 ÷ elapsed months) − 1. It becomes the editable nominal property-growth assumption; the matched after-CPIH rate remains visible as context.
ONS CPIH index observations are matched to those exact start and end months. Historical inflation uses the same annualisation exponent. Growth after CPIH is calculated as ((price factor ÷ CPIH factor)^(12 ÷ months)) − 1, not nominal growth minus inflation. Nominal history enters the model unchanged. Growth after CPIH is shown only as historical purchasing-power context, so the cash-flow model remains nominal.
The April 2026 source is deliberately cut off at April 2025 for these calculations, leaving out the normal 12-month revision window. English local-authority evidence is shown beside its English regional benchmark. Northern Ireland is available only as a national quarterly series. Bedrooms and floor area are not selectable because the published source does not provide histories at that level.
How ONS rent evidence becomes an input
The rent-evidence chooser compares the unrounded Price Index of Private Rents for the selected area and rental segment at the beginning and end of a five- or ten-year period. The nominal annualised rate is (end index ÷ start index)^(12 ÷ elapsed months) − 1. That rate becomes the editable nominal rent-growth assumption. Rounded modelled monthly rent levels are displayed only to make the history easier to interpret; they are not used to calculate the rate.
ONS CPIH is matched to the same monthly endpoints. The after-CPIH result divides the rent-index factor by the CPIH factor before annualising, rather than subtracting the two percentage rates. Nominal rent growth enters the model unchanged and then steps at each twelve-month tenancy anniversary. Historical CPIH is never reused as a future inflation forecast.
The June 2026 workbook is cut off at March 2026 so every English local authority and Northern Ireland Broad Rental Market Area uses observed data through the same month. English results use achieved rents from new and existing tenancies; Northern Ireland results use advertised new lets. Local results sit beside an English regional or Northern Ireland national benchmark, and manual editing removes the evidence attachment.
How historical investment evidence works
The investment percentage remains editable, but it can be filled from the actual before-tax/NAV history of a representative global fund (VT) or US large-cap fund (SPY). Filed 5- and 10-year USD total-return factors are chained only across exact, non-overlapping periods. For a selected window, the calculation is GBP factor = USD fund factor × (USD/GBP at start ÷ USD/GBP at end), then annualised. This represents an unhedged GBP conversion, not a GBP share class.
ONS CPIH is matched to the same December start and end months. The return after CPIH divides the compounded GBP and CPIH factors; it does not subtract their annual percentages. The chooser shows the fund return in USD, currency effect, GBP nominal return, CPIH and return after CPIH. The nominal GBP figure is the only historical rate applied to the model; CPIH and after-CPIH figures remain visible as read-only context. Historical CPIH is never reused as a forecast, and manual editing removes the evidence attachment. Manual values are treated as nominal.
- 01
Amortise the mortgage
The repayment is divided between interest and principal. Interest is a cost. Principal reduces the loan balance and becomes home equity; it is not counted as a cost merely because it left the bank account.
- 02
Apply housing costs
The buying path includes maintenance—current property value × annual percentage ÷ 12—plus entered home insurance, service charge and ground rent. The renting path includes rent, renter insurance and other monthly costs. Upfront purchase costs, SDLT, renter costs and eventual selling costs are recorded separately.
- 03
Equalise the monthly budget
The difference between the two paths’ required monthly outgoings is invested by the cheaper path. This comparison is recalculated every month, so compounding follows the timing of the actual difference rather than an annual shortcut.
- 04
Update assets and balances
During each month, property and existing investments grow; mortgage interest accrues and the fixed payment is applied, capped at the balance plus interest. The budget surplus is contributed at month-end. Rent steps at each twelve-month anniversary. These assumptions are inputs—not forecasts.
03 / THE RESULT
Net wealth, not a winner’s badge
At each year and at the selected end date, the tool compares the wealth associated with each path. It also shows the accumulated costs and any point at which the leading path changes.
Nominal or today’s money
The underlying comparison is always calculated in nominal pounds. The optional today’s-money view divides each future amount at month m by (1 + assumed inflation)^(m ÷ 12). Day-one amounts are unchanged, recurring costs are converted in the month they occur, and selling costs are converted at exit.
Changing only the display basis does not recalculate the winner, crossover month or sensitivity labels. The forward inflation assumption is separate from realised historical CPIH. Changing forward inflation affects the today’s-money display only; it does not rewrite an evidence-backed nominal growth input.
Buying path
Hypothetical liquidated wealth: property value less the outstanding mortgage and percentage selling costs, plus any investments built from cheaper months.
Renting path
The invested capital not used to buy, plus investments built from cheaper months and the rental deposit returned at its nominal value at exit.
What “durable crossover” means
The leader is determined from the nominal wealth difference each month. An absolute difference below £0.50 is treated as level. The durable crossover is the first month after the last non-level month led by the eventual losing path; from that point, the end winner never trails again, although level months may occur. If the other path never leads, the result says the final winner “never trails,” which includes an initial level month. If the paths finish level, there is no durable lead. Switching to today’s money does not reclassify the leader or move the crossover month.
A result such as “buying is ahead” means only that it is ahead in this model, over this period, under these assumptions. It does not measure flexibility, security, emotional value or whether a mortgage is affordable or available.
04 / UNCERTAINTY
Precision is not certainty.
Small changes in property growth, investment returns, mortgage rates or the length of stay can reverse the answer. The tool therefore keeps two explicit growth-and-return stress cases beside the selected inputs. Mortgage rate, stay and every other input remain unchanged in these automatic cases; edit them directly to test those uncertainties.
Favours renting
Property growth is up to 1.5 percentage points lower, rent growth is up to 1 point lower and investment return is up to 1 point higher than the selected inputs.
Selected inputs
Every input is used exactly as selected. This is a working case, not a prediction or implied central probability.
Favours buying
Property growth is up to 1.5 percentage points higher, rent growth is up to 1 point higher and investment return is up to 1 point lower than the selected inputs.
These labels describe the direction of the three changed assumptions, not a guaranteed outcome or probability. Each case is passed through the same supported input ranges, so a rate already at a boundary may move by less than the target stress. The live scenario descriptions are generated from the actual post-normalisation differences and the cards show the actual rates used. The app does not assign a likelihood to any scenario or average them into a single “expected” future.
05 / TAX SCOPE
England and Northern Ireland only
The initial calculator models residential Stamp Duty Land Tax for England and Northern Ireland using date-labelled rules. It supports the standard home-mover, first-time-buyer and additional property modes, plus a manual no-SDLT selection.
Do not use this SDLT estimate for a Scottish or Welsh purchase.
Scotland uses Land and Buildings Transaction Tax; Wales uses Land Transaction Tax. The model does not silently substitute English bands for either system. The no-SDLT option is a manual override, not a determination that an exemption applies.
See the current bands, effective dates and unsupported special cases on the sources page.
06 / EXCLUSIONS
What this model cannot decide
Tax and finance
- Scotland LBTT and Wales LTT
- Non-resident surcharges and unusual SDLT reliefs
- Company, trust, linked or shared-ownership purchases
- Buy-to-let, income, dividend and capital-gains tax
- Mortgage eligibility or regulated product advice
Life and property
- Tenure security, flexibility and moving disruption
- Property condition or unexpected major works
- School, commute and neighbourhood preferences
- Costs or cash flows you have not entered
- The future path of markets, rent or interest rates
Informational, not personal advice
Use the calculation to test assumptions and ask better questions. Do not use it as the sole basis for a property, mortgage, tax or investment decision.