The honest UK buy-vs-rent comparison: a lifetime net-worth model that runs the owning path (SDLT, mortgage, ownership costs, capital growth, CGT-free under PRR) in parallel with the renting path (invest the deposit + the monthly cash-flow difference at an assumed market return). The crossover year tells you when buying first overtakes renting + investing — a useful sanity check when you're weighing flexibility vs equity-building.
Buy vs Rent — Lifetime Wealth
The honest comparison the lead-gen sites avoid. Buy: SDLT + mortgage + ownership costs + capital growth (CGT-free under PRR). Rent: invest the deposit and the monthly cash-flow difference at a market return.
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Headline
Buy net worth (yr 25)
£643,216
Rent + invest net worth (yr 25)
£322,273
Crossover
Year 2
When buying first overtakes renting + investing.
Lifetime net worth
Owner's equity vs renter's invested portfolio.
Wealth gap (buy minus rent)
Above zero = buying ahead. Below zero = renting + investing ahead.
Assumes PRR (no CGT on owner-occupier sale), rent invested at the assumed market return. Subjective non-financial factors (stability, flexibility, optionality) are deliberately not modelled.
Use these together
Calculators that pair naturally with this one.
Frequently asked questions
Answers to the questions UK property investors most often have about this tool and the underlying rules.
- Does buying always beat renting long-term in the UK?
- No — the answer depends on the deposit size, the property price, the rent-to-price ratio in your area, and the assumed investment return. Renting + investing the deposit + monthly cashflow difference at 6-7% real returns can beat buying in low-growth, high-price areas (especially London and the South East). The crossover happens late, but it does happen.
- What assumptions matter most?
- Three: capital growth rate (UK long-run real average is ~3%), investment return for the renter (UK equities ~5-6% real), and rent-to-price ratio (the lower the rent, the better renting looks). Small changes in these assumptions can flip the answer.
- Does this account for PRR (no CGT on owner-occupier)?
- Yes. The owning path treats the property as your main residence — fully exempt from Capital Gains Tax under Principal Private Residence relief. The owner's net worth at year N is property value + accumulated principal repaid, with no CGT haircut.