Buy vs rent
Renting and buying differ in monthly cost, but the gap widens once you count upfront cash — deposit, stamp duty, and buying fees. Those costs hit harder if you move often, because you pay them again with each purchase. Over a full mortgage term, equity, house prices, and spare cash on the rent path all shape the longer picture.
Imagine the same £350,000 home: 15% deposit, 5% rate, 25-year term, with ownership costs included. Monthly rent for a comparable place might be £1,400, rising at 2.5% a year. If the buy path costs more each month, the model assumes you invest the difference at 7% a year (before tax).
Early on, buying often looks expensive — mortgage plus running costs versus rent alone. Over 25 years, mortgage paydown, possible house price growth, and compounded investments on the rent path all feed into total assets at the end of the term.
Net asset difference is buy total assets minus rent total assets at the end of the mortgage term. Positive means buy is ahead on this scenario; negative means rent is ahead. It is a model output, not a forecast of the market.
The comparison needs the full buy-side cashflow, including running costs. Tweak rent growth, investment return, maintenance, and appreciation to see how sensitive the result is to your assumptions.
Change the inputs on the calculator — price, nation, or buyer type — and see how the numbers respond.
Run a rent vs buy scenarioAssumptions and sourcesThe true cost of owning a home (beyond the mortgage)
The monthly mortgage repayment is usually the biggest housing cost, but it is not the only one. Council tax, buildings insurance, maintenance, and sometimes service charges or ground rent all come out of your budget too. Adding them up gives a clearer picture of what living in the property actually costs.
Read guideHow much stamp duty will I pay in 2025/26?
Stamp duty is transaction tax on residential property. You pay nothing on the slice below the first threshold, then progressively higher rates on amounts above. The total is the sum of tax on each slice — not one flat percentage of the whole price. That slice-by-slice structure catches many first-time buyers by surprise.
Read guideFixed rate ending: a six-month checklist
When a fixed deal ends you usually move to a new rate. Even a one or two percentage point change can add a large amount to the monthly payment. Starting four to six months early gives you time to compare routes without drifting onto an expensive standard variable rate.
Read guidePalta Money is for education and planning only. It is not regulated financial advice. Tax rules and rates change; confirm figures with official sources or a qualified adviser before you commit.