Rent vs Buy Calculator

What actually counts as the "monthly cost of owning"?

Most rent vs buy comparisons stop at the mortgage payment, which flatters buying every time. This calculator doesn't. It takes your mortgage repayment (calculated on the property price minus your deposit, at the rate and term you enter) and adds a maintenance, insurance and repairs allowance modelled at 1% of the property price per year, divided by twelve. That 1% figure is an illustrative Which?/ABI-style benchmark covering things like boiler servicing, buildings insurance, roof and guttering repairs and general wear and tear (Which?, 2026); it isn't a quote, but a realistic floor rather than a ceiling.

Skip that allowance and you're comparing rent to a number that no homeowner actually pays. Include it and you get a genuinely like-for-like monthly figure.

So if you've been comparing your rent to a mortgage calculator's headline payment alone, you've been underestimating the true cost of owning by roughly £150-£300 a month on a typical property: recalculate before you decide anything.

How does the worked example break down?

Take a renter paying £1,200 a month who is eyeing a £280,000 property with a £28,000 deposit (10%), on a 25-year term at 4.57%, the best-buy rate on a 2-year fixed at time of writing (Moneyfacts, July 2026).

So if your numbers look similar to this, renting is the cheaper option month to month right now. That's only half the sum, and it's exactly why the sections below matter.

Why doesn't a lower renting figure automatically mean renting wins?

A £444 monthly gap sounds decisive until you remember what a mortgage payment is actually made of. Part of it is interest, which is a genuine cost, but part of it is capital repayment: money that reduces your loan balance and eventually becomes equity you own outright. Rent, by contrast, is 100% cost with nothing to show for it afterwards. On top of that, private rents have been rising consistently over recent years and show no sign of a sustained fall (ONS Private Rental Market statistics, 2026), whereas a fixed-rate mortgage locks your rate for the term you choose, giving you payment certainty renting doesn't offer. There's also the deposit itself: £28,000 sitting in a current account earns you nothing, while house prices (Nationwide put annual growth at +2.2% in June 2026) have historically drifted upwards over the medium term, though that is never guaranteed and can go into reverse.

So the £444 gap this calculator shows you is a starting point, not the final answer. It tells you the monthly cash difference, not who comes out ahead over five or ten years.

How much do the deposit, rate and term actually move the answer?

A bigger deposit shrinks the mortgage balance directly, so an extra £10,000 down on the £280,000 example above cuts roughly £56 off the monthly mortgage payment at the same rate. Rate matters even more: the gap between a 4.57% best-buy and a poorer 5.5% deal on the same £252,000 loan is close to £150 a month, which is why it's worth checking where you'd actually qualify before running this tool with an optimistic rate. Stretching the term from 25 to 30 years lowers the monthly figure but increases the total interest paid over the life of the loan, so a cheaper monthly result on a longer term isn't automatically the better deal: it can simply defer the cost rather than remove it. Before you commit to a price bracket, it's worth checking what you can realistically borrow with the affordability calculator, and factoring in Stamp Duty with the Stamp Duty calculator, since that upfront cost doesn't show up in a monthly comparison at all.

So don't run this calculator once and treat the output as fixed. A slightly larger deposit or a better rate can close a several-hundred-pound gap faster than waiting another year to save more.

What this means for you

Use this tool for what it's built to do: an honest, monthly, cash-in-cash-out comparison, not a verdict on your financial future. It deliberately ignores capital growth, the opportunity cost of your deposit, and the equity you build with every mortgage payment, because those depend on how long you stay and how the market moves, which nobody can promise you. The maths points towards buying making more sense the longer you plan to stay in the property, since the fixed-rate certainty and equity-building offset a modest monthly premium over renting; it points towards renting making more sense if you need flexibility within the next two to three years, or if the monthly gap in your own numbers is large and your deposit is thin. Most people who run these numbers end up using the result as one input alongside their job security, how long they intend to stay put, and what a Stamp Duty bill and moving costs would do to their savings. Track your ongoing costs against a purchase with the cost of ownership tracker once you've decided.

So treat the monthly figure as your opening question, not your closing argument. If you're in a stable job, plan to stay five years or more, and the gap is under roughly £200-£300 a month, that's usually where the maths starts favouring a purchase.